As telecom companies are moving ahead with bringing out mobile commerce (m-commerce) on a large scale, they have been asked by the Finance Minsitry to do so only after tieing up with banks.

This indicates that the revenue earned by telecom operators from this venture has to be shared with banks.

"Telecom companies cannot carry out lending, borrowing and m-commerce activities without being regulated by the Reserve Bank of India. Telecom operators will have to tie up with banks to offer these services," a senior Finance Ministry official said.

Although telcos and banks have decided on their roles in the venture, but the Finance Ministry worries that if banks are not brought ito play, telcos could start acting as money lenders in the business without being regulated by RBI.

Also since prepaid cards are allowed in m commerce, the finmin worries that the customer identification process might not be as stringent as would have been if banks were involved. Moreover, RBI prefers the mobile banking drive designed by banks over telcos.

But telecom operators feel some of their services would be hampered in the process of tie up with banks. "If we have to tie up with banks for all m-commerce activities, some services such as the mobile wallet, which allows users to directly buy goods from a retailer, may not be possible," said a Delhi-based mobile operator.