NTT payments may pursue M&A route into lending

NTT DATA Payment Services (NDPS), a Reserve Bank of India-licensed payment aggregator, is eyeing entry into lending business and has kept options on merger and acquisition (M&A) route as it looks to diversify beyond payments after scaling its core payment services business.

Speaking on the sidelines of the launch of Adaptis—a unified service brand for payment and commerce solutions—Take Ueno, CEO and Director of NTT DATA Payment Services, said that the priority in India is now on payment processing through partnerships with licensed entities.

“The first step is to provide a service.  If the volume is increasing, we need to invest to buy the licensing, in another way,” said Ueno in an interview to The Hindu. 

“If we like the business and if we do it, we can go through an M&A route,” Rahul Jain, Chief Financial Officer of NTT Data Payment Services India Pvt Ltd. 

Highlighting the two options they have — either to acquire a license (for lending business) or grow inorganically; the company’s leadership said that they would take a wait-and-see approach over the next two to three years to evaluate whether the business model could be scaled successfully.

Ueno further said that getting a license would be good in some cases and “not so good” in others and depending on the situation, they would make a decision. 

India is the fifth country after Malaysia, Thailand, Philippines, and Japan in which NTT launched the Adaptis brand. In a competitive industry with Razor Pay or PayU, NTT Data is expecting its net earnings to grow 20% every year.

In 2019, NTT DATA, a global Japanese leader in IT and business services, acquired Atom Technologies, which now operates as NTT DATA Payment Services India.