The mobile payment company, Paytm is in plans to launch India’s first payments bank sometime during this fiscal year. It is counting on the mobile wallet experience in order to give a clear advantage over the established business houses that might be its key rivals.
The Co-Founder of Paytm, Vijay Shekhar Sharma stated that the company has sorted the payment on wallet and it wants to control the same. The firm will drive as well as scale the payment business while the others have to create their payments business.
Paytm is expecting to reach Rs 10,000 crore in deposits within three years. This way, the brand will build on the existing consumer base and cost efficient and technological set up.
Paytm is has over 104 million mobile wallets and it expects to reach 150 million by March 2016. The executive stated that they have an edge on the timeline. The next year or within a year and half, similar companies will get started, but Paytm will be playing the business even then.
Paytm is the youngest licensee among the 42 applicants that have got the approval to start payments bank. These companies will take the deposits, convey the remittances and dispense the payments to the recipients. This way, they will make them ideal for the migrant workers who have to send money home. They cannot lend to their customers.
The telcos including Airtel, Vodafone and Idea are stated to have experience in the mobile remittance businesses that will start with a near-equal footing. He also stated that Paytm does not do remittances and that its capability is in the merchant transactions as well as person to person payments.
Paytm is looking for a CEO with the financial services as well as consulting background. The person has to have a banking background and he or she has to bring the traditional approach. The new company that has been formed called Paytm Payment Bank Ltd will house the payments bank and the mobile wallets business.
By the end of this fiscal year, One97 Communications that is backed by Alibaba Group that holds Paytm’s businesses will streamline its operations to the payments bank and wallets, marketing and commerce businesses. The expertise and experience gained by Paytm can set the company ahead of its rivals.