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Paytm Payments Bank Reports Losses Of $4.6 Mn

Paytm Payments Bank Reports Losses Of $4.6 Mn

Launched In May 2017, Paytm Payments Bank Is Looking To Open 31 Branches And 3,000 Customer Service Points Within First Year

Between August 2016 and March 2017, Paytm Payments Bank reported losses of around $4.6 Mn (INR 30.7 Cr). According to its MCA filings, the firm saw a turnover of $378K (INR 2.47 Cr) during the said period.

Incorporated in August last year, the payments bank formally launched operations in May 2017.

As per the documents, total expenditure between August 22, 2016 and March 31, 2017 touched $5 Mn (INR 33 Cr), while the bank’s authorised capital reached $61.2 Mn (INR 400 Cr).

The net worth of Paytm Payments Bank, according to sources, currently stands at $28.6 Mn (INR 187 Cr).

Recently, in the month of September, the payments bank reportedly raised $9.3 Mn (INR 60 Cr) from One97 Communications founder Vijay Shekhar Sharma and other existing investors. As per a regulatory filing, Sharma infused $4.6 Mn (INR 30 Cr), while One97 Communications contributed around $3.5 Mn (INR 23 Cr) in the company. The remaining $1.09 Mn (INR 7 Cr) came from One97 Communications India, a wholly-owned subsidiary of One97.

At the time of its launch in May 2017, the bank received an initial investment of $34.2 Mn (INR 220 Cr), with Sharma holding 51% stake in the firm.

Paytm Payments Bank: A Glimpse

Paytm Payments Bank is a mobile-first bank with zero charges on all online transactions and no minimum balance requirement. The firm’s head office is located in Noida.

In December 2016, One97 Communications issued a public notice that it would be transferring its wallet business, to the newly-incorporated payment bank entity. Later in January 2017, the parent company of Paytm received permission from the Reserve Bank of India to formally launch the Paytm Payments Bank.

To gain traction among the country’s banking population, the payments bank offered customers cashback of INR 250 on deposits of up to $387 (INR 25K). The offer was available for a few weeks post its launch. For savings accounts, the company currently offers an interest rate of 4% per annum, which is slightly lower than the interest rates of Airtel and India Post.

The five-member board of the firm includes former RBI Executive Director PV Bhaskar, Saama Capital Managing Partner and co-founder Ash Lilani, and former Shriram Group Director GS Sundarajan. Paytm founder and CEO Vijay Shekhar Sharma currently serves as the non-Executive Chairman. Renu Satti, CEO – Paytm Payments Bank, also joined the board as a director.

The firm has since revealed plans to open 31 branches and 3,000 customer service points in a year. According to Vijay Shekhar Sharma, the goal is to reach 500 Mn bank accounts by 2020. As per reports, the bank is also gearing up to team up with universal banks to expand the reach of its financial services.

In 2016, the RBI offered its in-principle nod to 11 entities for establishing payments bank operations in the country. Competitors of Paytm include Airtel Payments Bank, Fino Payments Bank and India Post.