Paytm, the leading mobile pay firm in India, announced Tuesday (Jan. 3) that it received permission from the Reserve Bank of India to formally launch Paytm Payments Bank.
In a blog post announcing the new initiative, Paytm said: “At Paytm Payments Bank, our aim is to build a new business model in [the] banking industry, focused on bringing financial services to hundreds of millions of unserved or underserved Indians. With [the] power of technology and innovation at scale, we aim to become a benchmark in [the] world of banking.”
The company said receiving the license gives it a chance to create something Indians will be “proud of,” noting that Paytm plans to follow three principles: “No fear, no greed and no entitlement.”
The move on the part of Paytm to launch a bank comes at a time when Indians are reeling from a cash crisis after the prime minister banned high-denomination currency from the system as a way to clamp down on fraud. Since then, digital wallets have been exploding.
Last week, Paytm revealed lofty plans to onboard 5 million merchants this year. The idea is to add new features and services that will help it reach its goal to have 5 million merchants accept and make digital payments next year. What’s more, Paytm is planning on working with sales and distribution firms to accept Paytm payments from merchants. By doing that, merchants would have another reason to use Paytm, noted the report.
“These new initiatives could significantly broaden Paytm’s addressable audience and give it further opportunity to grow following major shifts in the Indian payments industry as a result of demonetization where the government removed 500- and 1,000-rupee notes from circulation in November,” the report stated.