South Asia

Paytm Launches Payments Bank To Serve The Underserved In India

Indian digital payments firm Paytm has officially launched a niche payments bank as part of its drive to double its customer base to 500 million over the next three years.

The payments bank operates 31 branches and 3,000 customer points in its first year, the company noted in a release. Payments banks can take deposits but cannot make loans. Paytm's bank will offer an interest of 4 percent a year on savings accounts and also provide current account facilities to merchants. It will have no minimum balance requirements, and all online transactions will be free.

The goal, according to  Paytm, is to reach the tens of millions of customers in the nation who regularly use mobile phones and cheap data services but who do not have access to regular banking services.

Paytm has recently seen its fortunes greatly buttressed by the Indian government's decision to ban high-value currency notes late last year.  That resulting cash hole in the economy has pushed millions onto digital wallets over the last several months — as of last official count, Paytm says more than 220 million clients use its e-wallet.

Paytm also has some fairly famous investors — last week, Japan's SoftBank invested $1.4 billion in Paytm’s parent, One97 Communications.

Initially, bank accounts will only be available by invite.

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The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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