Paytm plans to hire 10,000 more agents to complete KYC norms
, ET Bureau|
Updated: Oct 16, 2017, 08.31 AM IST
MUMBAI: Mobile wallet provider Paytm plans to double its team of agents and is preparing to open 1,00,000 branches across the country that, among other things, will make it easier for its users to complete the know-your-customer (KYC) norms.
The payments company has set an ambitious target of reaching 500 million full-KYC customers in three years. Paytm, which is converting itself into a payments bank, said the Reserve Bank of India's recent guidelines for prepaid payment instruments or mobile wallets put standalone mobile wallets at a disadvantage with its strict KYC norms and additional regulatory requirements.
"We already have 10,000 people on the street doing KYC of our customers, now we are planning to hire 10,000 more within the next two months to expand our capacity to do physical KYC," said Renu Satti, CEO of Paytm Payments Bank.
"Also, we will open 1,00,000 banking outlets where customers can come in for biometric authentication and other basic banking facilities as well."
Paytm transferred its mobile wallet or PPI licence to the payments bank earlier this year. Satti said each banking outlet would be a combination of a mini branch with two or three people and a network of business correspondents who will undertake basic banking activities and complete KYC formalities for the company's customers.
Last week, RBI mandated full KYC even for mobile wallet users and increased net-worth requirements for companies to apply for a PPI licence. While the industry has lauded the regulator's efforts to strengthen the digital wallet business, some companies said that the new norms would kill the separate payments bank proposition.
Highlighting the fact that a fully KYC-compliant customer of Paytm Payments Bank would get a minimum 4% interest on the balance money in their account, Satti said the new guidelines put standalone wallets at a disadvantage as they cannot give any interest on wallet balances, in spite of incurring similar costs for meeting the KYC requirements.
"Standalone wallets are clearly at a disadvantage," Satti said. "Money kept in your Paytm Payments Bank account along with its wealth management solutions can give returns of 4-6%, while the money in digital wallets cannot earn any interest."
Further, with RBI's provision for easy movement of funds between the Paytm bank account and the Paytm wallet, it will be cheaper for Paytm to load money into its customers' wallets. Standalone digital wallets, though, will have to bear the merchant discount rate (MDR) while loading money into wallets, which is much higher, Satti said.
The payments company has set an ambitious target of reaching 500 million full-KYC customers in three years. Paytm, which is converting itself into a payments bank, said the Reserve Bank of India's recent guidelines for prepaid payment instruments or mobile wallets put standalone mobile wallets at a disadvantage with its strict KYC norms and additional regulatory requirements.
"We already have 10,000 people on the street doing KYC of our customers, now we are planning to hire 10,000 more within the next two months to expand our capacity to do physical KYC," said Renu Satti, CEO of Paytm Payments Bank.
"Also, we will open 1,00,000 banking outlets where customers can come in for biometric authentication and other basic banking facilities as well."
Paytm transferred its mobile wallet or PPI licence to the payments bank earlier this year. Satti said each banking outlet would be a combination of a mini branch with two or three people and a network of business correspondents who will undertake basic banking activities and complete KYC formalities for the company's customers.
Last week, RBI mandated full KYC even for mobile wallet users and increased net-worth requirements for companies to apply for a PPI licence. While the industry has lauded the regulator's efforts to strengthen the digital wallet business, some companies said that the new norms would kill the separate payments bank proposition.
Highlighting the fact that a fully KYC-compliant customer of Paytm Payments Bank would get a minimum 4% interest on the balance money in their account, Satti said the new guidelines put standalone wallets at a disadvantage as they cannot give any interest on wallet balances, in spite of incurring similar costs for meeting the KYC requirements.
"Standalone wallets are clearly at a disadvantage," Satti said. "Money kept in your Paytm Payments Bank account along with its wealth management solutions can give returns of 4-6%, while the money in digital wallets cannot earn any interest."
Further, with RBI's provision for easy movement of funds between the Paytm bank account and the Paytm wallet, it will be cheaper for Paytm to load money into its customers' wallets. Standalone digital wallets, though, will have to bear the merchant discount rate (MDR) while loading money into wallets, which is much higher, Satti said.
