Reliance Industries Ltd, led by billionaire Mukesh Ambani, announced on Friday its intention to demerge its financial services division and subsequently list it on the stock exchanges. According to the company’s statement, existing Reliance shareholders will receive one equity share of Jio Financial Services Ltd (JFSL) for each share held in the company.

JFSL is set to venture into consumer and merchant lending, exploring avenues for organic growth, joint ventures, and potential opportunities in insurance, asset management, and digital broking segments. The Board of Directors of Reliance Industries Ltd approved the Scheme of Arrangement, through which the financial services undertaking will be demerged into JFSL (to be renamed from Reliance Strategic Investments Limited or RSIL). JFSL is slated to be listed on Indian stock exchanges.

As part of the scheme, RIL shareholders will be allotted one equity share of JFSL, with a face value of Rs 10, for every fully paid-up equity share of Rs 10 held in RIL. Additionally, RIL’s investment in Reliance Industrial Investments and Holdings Limited (RIIHL), a component of its financial services undertaking, will be transferred to JFSL.

JFSL aims to acquire liquid assets to ensure sufficient regulatory capital for lending to consumers and merchants. It also plans to incubate other financial services verticals, including insurance, payments, digital broking, and asset management, over the next three years. The company already possesses regulatory licenses for key business operations.

Mukesh Ambani, commenting on the demerger, expressed that JFS would be a transformative, customer-centric, and digital-first financial services enterprise, providing innovative and affordable products to all Indians. He emphasized JFS’s technology-led approach, delivering financial products digitally through Reliance’s extensive nationwide omnichannel presence.

The transaction is contingent on customary statutory and regulatory approvals, including those from NCLT, stock exchanges, SEBI, and RBI. Ambani believes that JFS, uniquely positioned in the Indian financial services sector, is poised to capture growth opportunities in the under-penetrated and expanding market, particularly in retail and small-business-focused product categories.