India’s Top Mobile Wallet App Adds Support For Payments To Bank Accounts
TECHCRUNCH: Paytm, a India-based mobile payments service operated by (now) Alibaba-backed One97, has introduced a big new feature that lets 25 million users transfer money to bank accounts. Mobile wallets, like that of Paytm, have grown in popular in India, where credit card adoption is low and many services, including online retailers, process a lot of cash-based transactions. (Its billion-plus population is estimated to have just 450 million bank accounts, with many unused.) Wallets are at the intersection of that, providing greater reliability than cash, but without requiring users to get bank accounts.
Now that it allows users to transfer money into their bank account (or that of a friend), Paytm’s wallet — which is supported by Uber, among other services — becomes a more versatile way of managing small cash floats.
Those using the new Immediate Payment Service (IMPS) service can transfer a maximum of 5,000 INR ($80) per day, and up to 25,000 INR ($400) per month. The minimum amount per transaction is 1,000 INR ($16), and the sender should have at least 2,000 INR ($32) in credit.
One97 has spoken of this new feature before, but its introduction is all the more fascinating considering Alibaba’s investment in the company last month. That deal, which was pegged at $200 million at a billion-dollar valuation for One97, was the Chinese giant’s first in India. It was actually conducted via its Ant Financial Services Group, which runs Alipay, China’s top payments service.
Ant, which is tipped for a China-based IPO this year, last year secured regulatory approval to launch its own internet bank in China. Its public listing is supported by a number of state-owned banks in China, which suggests that it will work with the system rather than to disrupt it, but Ant’s influence on Paytm’s plans — which could, theoretically, include more banking-like services now that it offers IMPS — will be one to watch. A representative said Paytm doesn’t plan to enter banking itself, but tapping into Alibaba stands to be hugely beneficial.
The launch of IMPS is also accompanied by plans to open 50,000 “retail outlets” across India. These will be physical locations where Paytm users can load money into their wallet. Next up will be peer-to-peer payments, which is currently limited to Android devices but will launch across iOS too, the company told TechCrunch. In other news for One97 today, the organization landed financial backing from businessman Ratan Tata, chairman Emeritus of Tata Sons — the holding firm behind the $100 billion dollar-valued Tata Group.
The company declined to reveal the size of Tata’s “minority” investment, but it did reveal that it plans to grow Paytm’s total registered wallet number to 100 million by the end of the year. Its mobile shopping app has now clocked $1 billion in gross merchandise value (GMV, aka the value of goods on its site) — hitting that mark as scheduled — and it plans to raise that figure to $4 billion by the end of 2015.