Paytm Payments Bank, a payment bank arm of the online payments and booking platform Paytm, is receiving additional funding of around ₹60 crore from its parent company One97 Communications.
At the time of launching the new venture, Vijay Sharma, founder of the company, and One97 had invested about ₹220 crore in the payments bank. With this, Vijay Sharma ended up owning a majority stake in the bank, as required by the RBI’s directive.
In the current round worth ₹60 crore, Vijay Sharma has invested about ₹30 crore, while One97 Communications has put in about ₹23 crore. The rest of the company is coming from One97 Communications India, a subsidiary of One97. This was revealed through documents filed with the Registrar of Companies.
With this new capital allotment, the total authorised capital of the Paytm Payments Bank is now ₹400 crore and the paid up capital is now ₹278 crore.
Payments bank is a not like the traditional bank and is a new phenomenon in India’s financial services and banking space. The account holder in such banking service provider is allowed to open accounts with a deposit limit of up to ₹1 lakh.
Paytm Payments Bank offers 4 percent interest on savings accounts, which is strikingly low when compared with Airtel’s Payments bank, which offers a 7 percent interest rate on a savings deposit.
It supports all the online transactions including NEFT, RTGS and IMPS. It is also issuing RuPay debit cards to the customers. Earlier, Vijay Sharma had said that the money invested by customers will be used in purchasing government bond to ensure a safer investment for people’s money.
It won’t be surprising if we hear about Paytm partnering with various banks going forward. The move could help the company is offering more financial services to its users.