Mumbai: Paytm Payments Bank (PPB) plans to expand into facilitating cross-border as well as domestic remittances. The bank’s CEO said that the new umbrella entity (NUE), proposed by PPB and other investors, will change the pace of digital payments in the country, if approved.
Speaking to TOI, the bank’s MD & CEO Satish Kumar Gupta said that it has become the largest enabler of digital transactions in India at 970 million in March 2021. It has also become the largest digital-only bank with 64 million bank accounts and deposits of over Rs 3,200 crore, he said.
According to Gupta, PPB’s digital transactions were diversified across many platforms including UPI, digital wallet, FASTag, and peer-to-peer transfers. As a result, the bank was not worried about the National Payments Corporation of India’s decision to cap market share in UPI transactions. “We also have the lowest technical decline rate at 0.1% among all UPI remitter banks and 0.04% among all UPI beneficiary banks,” he said.
He added that the bank has been reporting a profit from the year 2018-19. This would enable PPB to seek conversion into a small finance bank (SFB). Although the RBI had said it will relax its rules to allow payments banks to convert into SFBs after three profitable years, it has yet to notify the relaxed norms. Paytm is seeking to convert itself into an SFB that will enable it to extend loans.
The RBI’s decision to increase the end-of-day balance limits for payments banks to Rs 2 lakh will benefit small merchants who use PPB’s cash management services, he said. Gupta said that PPB has managed to grow transactions in number and value by nearly 25% despite taking a severe hit during the first three months of FY21 due to the Covid lockdown.
“For the coming year, we have received approval for facilitating inward remittance from foreign countries. In addition to this, we are also growing our domestic remittance business,” said Gupta.
Another new line of activity where the bank is seeking approval as an investor is the setting up of an NUE. While he said he could not share the details, Gupta said that the proposed entity, if permitted to operate, could change the pace of digital payments in India.
PPB has also taken over the Bharat Bill Payment Operating Unit business from its parent One97 in line with the RBI directive, which will add to its numbers during the current fiscal year.
Business News Governmental News Finance News
Need Your Help Today. Your $1 can change life.