Finally, after waiting for one long year Paytm has unveiled its Payments Bank, becoming the third payments bank in the country, after Airtel and India Post.
It will offer customers a 4 percent annual interest rate which the lowest among the three payments banks that is, Airtel offers about 7.3 percent interest and India Post about 5.5 percent annually. Apart from offering its customers cashbacks on deposits, Payment bank will offer zero charges on all online transactions and no minimum balance requirement.
Commenting on the development, Vijay Shekhar Sharma, Chairman, Paytm Payments Bank said, “RBI has given us an opportunity to create a new kind of banking model in the world. We are proud that our customer deposits will be safely invested in government bonds, and be used for nation building. None of our deposits will be converted into risky assets”.
Having its first branch in Noida Paytm plans to open 31 branches and 3,000 customer service points in a year. The company is setting up KYC centres across India to complete KYC for customers and make them eligible for a Payments Bank account.
Paytm Payments Bank accounts will initially be available on an invite-only basis. In the first phase, the company will roll out its beta banking app for its employees and associates. Paytm customers can request an invite by going to www.PaytmPaymentsBank.com or on the Paytm iOS app.
Every customer to open a Payments Bank account will get a cashback of Rs. 250 as soon they bring deposits of a total of Rs. 25,000 in their bank account. The account will have zero balance requirement and every online transaction (such as IMPS, NEFT, RTGS) will be free of charge. For savings accounts, the company would also offer an interest of 4% per annum. The company will also offer current accounts to its millions of merchants.
“ Our ambition is to become India’s most trusted and consumer-friendly bank. Leveraging power of technology, we aim to become the preferred bank for 500 million Indians by 2020,” said Renu Satti, CEO, Paytm Payments Bank.
Run and operated by One97 Communications, Paytm founder and CEO, Vijay Shekhar Sharma owns a majority stake in the company, with the remaining share owned by One97 Communications Pvt Ltd. The Paytm Payments Bank aims to build a new business model in the banking industry that is focused on bringing financial services to hundreds of millions of unserved or underserved consumers across India.
The company is aiming to replicate this success in the banking sector and further drive cashless transactions with the Paytm Payments Bank. The current Paytm Wallet will move to the Paytm Payments Bank in the same capacity, i.e. KYC Wallet as KYC Wallet and minimum detail KYC Wallet as minimum detail KYC Wallet. Users will continue to be able to use their Paytm Wallet in the same manner as before.
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