Mobile payments firm Paytm has secured regulatory approval from the Reserve Bank of India (RBI) to set up a payments bank.

“This is our chance to build something that every Indian can be proud of. No other role or responsibility means as much to me as the privilege of building Paytm Payments Bank, and I intend to take a full-time executive role in the Bank,” Paytm founder Vijay Shekhar Sharma said in a blogpost.

Vijay Shekhar Sharma was among the 11 entities who received in-principle approval in August 2015 from the RBI to launch payment banks. The other recipients were Airtel M Commerce Services, Aditya Birla Nuvo, Reliance Industries, Vodafone m-pesa, Tech Mahindra, Cholamandalam Distribution Services, Department of Posts, Fino PayTech, National Securities Depository, and Shri Dilip Shantilal Shanghvi.

Later, Tech Mahindra, Cholamandalam Investment and Finance Company and a consortium of Dilip Shanghvi, IDFC Bank and Telenor Financial Services backed out of the plan.

In November 2016, Airtel launched payments bank pilot services in Rajasthan. In the following month, Paytm merged its digital wallet service with its upcoming payments bank.

Payment banks are allowed to take deposits, offer internet banking, support fund transfers, sell insurance and mutual funds, and issue ATM/debit cards. However, they are barred from issuing credit cards and lending to customers.