Paytm to pump Rs 10,000 crore into banking

Alibaba-backed mobile wallet company Paytm has decided to invest Rs 10,000 crore over the next three years to ramp up its banking and financial services business.

The Noida-based company , which will soon offer payments bank services in the country, claims to have already pumped in over Rs 3,200 crore in the last two years for its operations.

"We will invest Rs 10,000 crore in our banking and financial services in the next three years. We hope to get the final approval for our payments bank operations soon, so that we can roll out services," said Paytm founder and CEO Vijay Shekhar Sharma.

Payments banks can accept deposits of up to Rs 1 lakh per account from individuals and small businesses. To deepen financial inclusion in the country, RBI had allowed small finance banks and payments banks to start services.

Currently, Airtel and India Post Payments Bank are the only two players that have commenced payments bank operations. Paytm was slated to begin operations around Diwali last year but it has been postponed due to delay in approvals.

Paytm has also been in discussions with multiple parties to raise fresh funding for as much as $1.5 billion. Reports suggest that Japanese investor SoftBank could pick up stake in Paytm in the coming weeks.

Sources said the company has also received interest from US-based HNIs for investing in Paytm. While Sharma did not comment on the discussions, he said there is interest from across geographies for putting in funds. Paytm has been one of the biggest beneficiaries of the government move to scrap old notes of Rs 500 and Rs 1,000 in November last year.

"We have seen significant growth and this year too, we expect to see a manifold growth to 4.5 billion. A significant part of this growth is coming from tier II and beyond cities," Sharma said.