Paytm looks to focus on merchant base to drive next phase of growth

An area which is a big focus for serving merchants is IoT-enabled devices such as Sound Box.

Paytm is looking at a comprehensive set of offers for its merchant base in order to drive its next phase of growth, according to two top executives.

From Internet-of-Things (IoT)-enabled hardware solutions to its Paytm for Business app, the e-commerce and payments firm is engaging more and more with its merchant base.

“When it comes to P2P (peer-to-peer) and merchant payments, the focus is obviously more on merchant payment. The P2P side of the business is taken care of by the payments bank which is already doing very well. When it comes to merchant payments, you need to create an entire ecosystem, and that is actually the area that requires a lot of investment,” said Narendra Singh Yadav, vice-president at Paytm.

He added that Paytm’s people budget over the last financial year has gone up by 50 to 60 per cent, and while the geography of incremental recruitment may change, overall hiring for expansion of these businesses will continue to rise.

Earlier this month, Paytm rolled out several solutions to address the problems of small merchants — the Paytm for Business app, Paytm Business Khata, Paytm PoS (point of sale) device and Paytm Sound Box.

“Over the last three to four years, we have come across various merchant use cases, merchant needs, which we felt that we can fulfill through technology… So, if we can solve for them, there is always scope to solve upwards from there,” said Sajal Bhatnagar, vice-president, business at Paytm.

An area which is a big focus for serving merchants is IoT-enabled devices such as Sound Box. It is a voice-activated PoS machine which works on a SIM card embedded in the device, and is available to a merchant at one-time deposit of Rs 700 and a Rs 50 per month thereon.

Paytm violated KYC rules, RBI reveals reason for blocking payments bank biz

RBI revealed the payments bank failed to maintain the prescribed net worth limit of Rs 1 billion and the bank also violated the end-of-the-day Rs 100,000 limit per account.

The Reserve Bank of India (RBI) has revealed that Paytm was in violation of know-your-customer (KYC) rules while on-boarding users for its payments bank business for which it was banned from opening new accounts and e-wallets in August, The Times of India reported.

In an RTI reply, the RBI revealed the payments bank failed to maintain the prescribed net worth limit of Rs 1 billion and also violated the end-of-the-day Rs 100,000 limit per account.

Payments banks are not allowed to hold more than Rs 100,000 in each account.

The RBI also expressed unhappiness at the close relations between Paytm founder Vijay Shekhar Sharma’s One97 Communications and the entity that runs Paytm Payments Bank (PPB).

While Sharma owns a 51% stake, the rest is owned by One97 Communications and its subsidiaries.

Payments banks are expected to maintain an arm’s length relationship with promoter group entities.

Following the RBI ban on opening new accounts and e-wallets, the bank’s then CEO Renu Satti resigned.

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Apple shelving UPI shows how foreign giants trip over Indian regulations

The first of the issues is the data localisation recommended by RBI; then there are Justice Srikrishna panel's draft privacy Bill, health ministry guidelines, and even the national e-commerce policy.

It is an oft-repeated, well known story, only the actors keep changing. For more than a year, Facebook-owned instant messaging giant WhatsApp has been looking to foray into India’s thriving digital payments industry but has moved little beyond a beta launch. Now, it is the $1-trillion US tech giant Apple that cannot find it in itself to launch a proprietary payments product using the country’s flagship Unified Payments Interface (UPI), suggest reports.

Apple’s move to shelve its UPI plan comes at a time when Google has placed massive bets on the Indian payments ecosystem, especially with its Google Tez app, recently rebranded to Google Pay, which allows people to pay, collect and request payments using UPI. However, Google isn’t too sure of its own future, either. The company is known to be assessing its plans in India, considering strict data localisation norms.

If the UPI values are rising at a breakneck speed each month – they have eclipsed credit card spends in the country – what could possibly be the reason for the three big giants in India’s digital story remaining largely out of the race? Regulations!

The first of the lot is data localisation as recommended by the Reserve Bank of India. Then there are Justice Srikrishna panel’s draft privacy Bill, guidelines of the health ministry, and even the national e-commerce policy. Data localisation simply means storing specific data related to individuals inside the geographic boundaries of the country. However, to different departments it means different things, and it can get confusing for companies.

For instance, earlier this year, RBI issued its master directions and gave companies six months to move to the country all payments and financial data related to Indian cities. RBI also used the phrase “only in India”, implying none of this data could be taken outside of the country for processing.

India’s payment industry has traditionally depended on giants like Mastercard, Visa and American Express, which brought a plastic money boom to the country. These three companies are known to process data at their master data centres outside India, so setting up new data centres just to satisfy RBI’s conditions did not go down too well with these players....Read More

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PM Modi highlights benefits of empowering citizens through Digital India

Modi also stated the initiative has brought in a movement towards more digital payments.

Prime Minister Narendra Modi said on Friday his Digital India flagship programme empowered citizens by eliminating middlemen' and promoted 4Es - Education, Employment, Entrepreneurship and Empowerment.


"We launched Digital India with a very simple focus -- to ensure more people can benefit from the joys of technology, especially in rural areas," he said while interacting with beneficiaries of the flagship scheme across the country via the NaMo App.


This was his fourth outreach with beneficiaries of government schemes through video conferencing. The event was streamed on social media site Facebook.


He also stated the initiative has brought in a movement towards more digital payments, thereby eliminating the concept of middlemen.


"Due to technology, railway tickets can be booked online, bills can be paid online... all this brings great convenience. We ensured that the advantages of technology are not restricted to a select few but they are there for all sections of society.
We have strengthened the network of Computer Science Corporations (CSCs)," he said.


Modi also said the scheme has been a major tool in bringing digital transformation in rural areas, especially northeast.


"Under our North East BPO Promotion Scheme (NEBPS), we are not just providing employment to youth in cities but also in the northeast.


The India BPO promotion scheme and a separate BPO promotion scheme for the northeast is creating new opportunities relating to the sector," he added.