Paytm is all set to launch the Paytm Payments Bank and the Bank is about to go live in India on Tuesday. Paytm Payments Bank has its headquarters in NCR in India. The Payments Bank is currently offering accounts only on an invite-based system where the invitees are mainly from North India. Paytm has also said that it would invest about Rs400 crore over the next two years to build its banking network across the country. Moreover, the bank plans to expand its physical presence to 31 branches and 3,000 customer service points in the first year. The firm is targeting 500 million customers by 2020.
Vijay Shekhar Sharma, founder of One97 Communication Ltd, which owns Paytm said in a statement to LiveMint that
“We will first start the services in Delhi-NCR followed by the second phase of launch in other top metro cities,”
The second phase of the Paytm Payments Bank is expected to rollout after 3 months and the company is expecting a customer acquisition cost of Rs125-150 crore over the next 12 months.
As for the details, Paytm Payments Bank will offer accounts with a zero balance requirement and every online transaction such as immediate payment service, national electronic funds transfer, real-time gross settlement will be offered free of charge. For savings accounts, the company will also offer an interest of 4% per annum, much lower than competitor Airtel Payment Bank’s interest offering of 7.2%.
Paytm Payments Bank will offer current accounts to its millions of merchants. Paytm Payments Bank will also offer a cashback of Rs250 to its first million customers who reach a deposit of Rs25,000.
Paytm Payments Bank is the latest Payments Bank to launch in the country while Bharti Airtel became the first payment bank to start operations followed by India Post Payment Bank. Both of these Banks started operations in November last year. The company said it will move all active wallet accounts on the Paytm app to the payments bank.