Mobile wallet services provider PayTM was among the 11 companies selected by the Reserve Bank of India (RBI) on Wednesday to help set up "payment banks".
Vijay Shekhar Sharma, founder and CEO, PayTM spoke to NDTV and explained how the payment bank platform is different from their existing mobile wallet platform - which is a prepaid payment instrument which allows customers to digitally store money in a secure virtual wallet and use it to pay bills and other services.
"We were not able to offer any commercial benefits like interest or we were not able to take any deposits from consumers. Now payment bank offers us opportunity to grow our business from just payments to deposits business also," Mr Sharma said.
The deposits will however be capped at Rs 1 lakh, as per the RBI guidelines. The initiative is part of India's financial inclusion push, meant to bring banking services to a country where less half the adult population has a bank account.
The company can issue debit cards and saving related products, as a payment bank, Mr Sharma said.
PayTM is partly owned by Alibaba's Ant Financial.
The companies that have been selected by the RBI have been given "in-principle" approval for 18 months, after which they will be given licences if they fulfil all conditions stipulated by the central bank.
(With Reuters Inputs)
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