Digital payments giant Paytm has announced that its QR feature now allows offline merchants to accept unlimited payments directly to their bank accounts at 0% charge. To that end, the company is gearing up to invest $77.75 Mn (INR 500 Cr) over the next 12 months to conduct merchant training and awareness initiatives.
This move is a part of the company’s efforts to facilitate mobile payments for both merchants and consumers by offering them more choices and convenience.
Paytm has been working on digital payments solutions since its inception and the practice gained momentum post demonetisation last year. Since then, the company has expanded its sales team to 10,000 employees and is working closely with in-store merchants to help them gain an understanding of the Paytm QR service.
Kiran Vasireddy, COO of Paytm said, “With Paytm QR, our merchant partners can now accept payments at 0% charge, directly in their bank accounts through multiple payment instruments including UPI and cards. And there is no monthly limit on collecting payments from their customers. We will continue to invest in expanding our payments network till the time every small and large merchant gets the power of mobile payments with Paytm.”
The company claims to have a 5 Mn merchant base and is targeting a growth rate of 6X in offline payments by mid next year.
With the recent development, the merchants get a chain of benefits like real-time fund transfer, 0% charge on receiving and accepting payments directly into bank account and no monthly limit acceptance limit.
Paytm In 2017: A Quick Recap
Paytm has made serious inroads into the Indian digital payments sector after demontisation. It currently has more than 200 Mn users on its platform, including local merchants, cab drivers and even street vendors.
In January 2017, the Vijay Shekhar Sharma led fintech company got the RBI’s approval to formally launch its payments bank. At the time, Sharma invested $32 Mn (INR 220 Cr) in order to set up the payments bank.
In a bid to facilitate easy transactions through its wallet, Paytm announced the integration of Unified Payments Interface (UPI), under which users were allowed to connect their UPI wallets with their Paytm wallet.
In March 2017, Paytm’s newly formed ecommerce unit raised $200 Mn (INR 1283 Cr) in a funding round led by Chinese ecommerce giant Alibaba. After a few days of this fundraise, the company introduced Paytm Mall, a shopping platform for its users. It was inspired by the model of China’s largest business-to-consumer (B2C) retail platform, TMall.
In May 2017, One97 communications, the parent company of Paytm was infused with a funding of $1.4 Bn from Japanese conglomerate Softbank.
Paytm was demerged into two separate entities, Paytm ecommerce and Paytm bank platform. The two entities further went on to introduce their new offerings in their respective sectors.
Paytm Mall has been providing tough competition to ecommerce giants like Flipkart and Amazon, by providing attractive cashbacks and its unique bazaar model. Paytm Mall delivers to more than 9000 pin codes across India. The company is committed to bring several offerings and has increased its sales through shopping festivals like the recently-held 12/12 festival.
In September 2017, the Paytm Payments Bank was again infused with $9.3 Mn (INR 60 Cr) by One97 communications founder Vijay Shekhar Sharma. The company announced that it had tied up with RuPAY to launch the Paytm debit card. In November 2017, One97 communications and Vijay Shekhar Sharma led another funding round of $18.84 Mn (INR 122 Cr) into the payments bank platform.
The company also planned an investment of $500 Mn in KYC (Know Your Customer) operations. It was involved in actively setting up KYC centers across India to complete KYC for customers and make them eligible for a Payments Bank account.
The firm also revealed its aggressive plans for the next three years: investment of $466.5 Mn (INR 3000 Cr), and opening 100K ATMs across the country.
According to a report by Morgan Stanley, India now has 800 Mn mobile phone users with 430 Mn having Internet connectivity. The number of Internet users is expected to grow to 915 Mn by 2027. The payments infrastructure of India is currently on fire, and with Paytm occupying the major chunk of the digital payments services sector and further introducing new features in its QR, it will be interesting to see how the digital payments evolves in the coming years.