After Airtel, Paytm is all set to begin its Payments Bank service. As per the latest report, Paytm founder, Vijay Shekhar Sharma, has now confirmed that the online payment service (e-wallet) will make its Payments Bank service operational as soon as next week.
Vijay said to BTVi, “We want to expand the network across the country and increase the penetration. We want to expand this to deposits and current accounts. I think 2017 will be the year for us to expand into banking. We have to build distribution, reach and customer base.”
Further, he also revealed that Paytm is eyeing a user base of about 500 million by 2020. Ever since PMO India, Narendra Modi announced demonetisation last year in November, Paytm has an immediate hike in the number of downloads, transactions and money loaded up in the wallet. People all around the country, be it a tea stall on the roadside or a proper grocery store, everybody accepted Paytm as their daily medium of transaction.
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“I think what we saw small shops, and people who traditionally didn’t get access to digital payments opted for digital payments. It’s very encouraging,” added Vijay.
If you are not aware, a Digital Payments Bank service provides complete digital and paperless banking services such as opening account, cash deposit, withdrawal etc. One can easily open an account with a Payments Bank via Aadhaar based e-KYC process and verify his credentials through biometric inputs or Iris scanner.
Earlier this year, Airtel became the first one to bring Payments Bank service in India. For the benefits, Airtel is providing an interest rate of 7.25 % on deposits in savings accounts. For comparison, banks such as Axis, ICICI, and HDFC offer 4 percent interest, while Yes Bank and Kotak offer 6 percent. Further, your Airtel mobile number will your bank account number and one can easily transfer funds to any bank account in India for free. Every subscriber to a Saving Account with Airtel Payments Bank also gets a free personal accidental insurance of Rs 1 Lac. On top of this, one would also get free Talktime for the amount deposited in his or her Airtel’s Bank account.
While Payments Bank is still far off from replacing the traditional Private and Public Sector Commercial Banks, the new Idea basically emphasises on the importance of digital payments. No doubt, Digital Payments is the path to go, but, will it prevail in a country like India? Let us know in the comment section below