{"id":38792,"date":"2024-04-30T04:38:02","date_gmt":"2024-04-30T04:38:02","guid":{"rendered":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/04\/30\/paytm-payments-banks-wallet-business-fading-fast-as-restrictions-bite\/"},"modified":"2024-04-30T04:38:02","modified_gmt":"2024-04-30T04:38:02","slug":"paytm-payments-banks-wallet-business-fading-fast-as-restrictions-bite","status":"publish","type":"post","link":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/04\/30\/paytm-payments-banks-wallet-business-fading-fast-as-restrictions-bite\/","title":{"rendered":"Paytm Payments Bank\u2019s wallet business fading fast as restrictions bite"},"content":{"rendered":"
\"Paytm<\/div>


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The regulatory action on Paytm Payments Bank<\/a> has brought the mobile wallet business<\/a> of the entity, one of its most popular offerings, to a grinding halt. While it cannot add new customers as per the Reserve Bank of India diktat, transactions<\/a> on the platform have fallen drastically over the last three months as consumers slowly move out of Paytm Payments Bank\u2019s wallet ecosystem.
According to data released by the RBI<\/a>, Paytm Payments Bank reported 7.4 million fund transfer transactions in its prepaid payment instruments business in March, down 64% from 20.7 million in December 2023. In terms of the usage of the wallet for goods and services, transactions were just over a fourth at 66 million, compared with 247 million in the same time period.<\/p>\n
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According to the RBI order, Paytm Payments Bank accounts (both savings and prepaid accounts) can be used only for pay-out transactions and users cannot load money into them. New user onboarding has been stopped at 597 million.<\/p>\n

In terms of the value of transactions, Paytm Payments Bank wallets reported Rs 4,163 crore worth of transactions in March, down 70% from Rs 13,997 crore in December 2023.<\/p>\n

Emailed queries to Paytm Payments Bank went unanswered.<\/p>\n

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ETtech<\/span><\/figure>\n<\/div>\n

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The RBI announced the action on Paytm Payments Bank on January 31.<\/a> The bank was initially given time till the end of February to stop offering basic banking services, but the deadline was later extended to March 15. The RBI will release April transaction numbers next month.<\/p>\n

To continue its core payments business, One 97 Communications-owned Paytm, which is the bank\u2019s associate entity, has migrated its Unified Payments Interface based <\/a>services to other lenders like Yes Bank<\/a>, Axis Bank<\/a>, HDFC Bank<\/a> and State Bank of India<\/a>, as a third party payment application.<\/p>\n

According to data shared by the National Payments Corporation of India, the Paytm app reported 1.2 billion transactions in March 2024.<\/a><\/p>\n

The payment bank has also been impacted in terms of UPI transactions originating from its accounts. In March, Paytm Payments Bank reported 98 million transactions originating from its accounts for UPI payments, a 76% fall compared with 410 million in December last year.<\/p>\n

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ETtech<\/span><\/figure>\n<\/div>\n

While the Noida-headquartered fintech firm moved its payments offering to UPI, it had to give up the lucrative mobile wallet<\/a> business which was built over the last decade. It had migrated the wallet business to Paytm Payments Bank in 2016 under RBI order. The payments bank was formed after Paytm founder Vijay Shekhar Sharma was awarded a licence for it in August 2015.<\/p>\n

According to industry insiders, fintechs prefer to route transactions through mobile wallets given they are a revenue-generating payment instrument. Unlike UPI, which is free of cost for consumers and merchants, there is an MDR (merchant discount rate) on wallet payments.<\/p>\n

While there has been a slowdown in Paytm Payments Bank\u2019s business, other fintech startups like Mobikwik, PhonePe, Amazon Pay and Slice have grown their wallet businesses.<\/p>\n

Industry data show that Mobikwik added 4 million new wallets to its tally between March and December last year. Bengaluru-based PhonePe, with 194 million wallets, added more than 40 million new ones in the same time period. Another Bengaluru fintech, Slice, which is in the process of merging with North East Small Finance Bank<\/a>, has grown its wallet business exponentially, albeit on a small base.<\/p>\n

Slice received its prepaid payment instruments licence in September 2023. In March the company reported 2.08 million wallets, compared to just 130,000 in September last year.<\/p>\n<\/div>\n


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The regulatory action on Paytm Payments Bank has brought the mobile wallet business of the entity, one of its most popular offerings, to a grinding halt. While it cannot add new customers as per the Reserve Bank of India diktat, transactions on the platform have fallen drastically over the last three months as consumers slowly […]<\/p>\n","protected":false},"author":2,"featured_media":38793,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"tdm_status":"","tdm_grid_status":"","fifu_image_url":"https:\/\/img.etimg.com\/photo\/msid-42031747\/et-logo.jpg","fifu_image_alt":"","footnotes":""},"categories":[607],"tags":[27202,3331,17028,449,21646,2210,14010,41252,672,665,663,2126,20942,3557,23031,24460,41251,1545],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/38792"}],"collection":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/comments?post=38792"}],"version-history":[{"count":1,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/38792\/revisions"}],"predecessor-version":[{"id":38794,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/38792\/revisions\/38794"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/media\/38793"}],"wp:attachment":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/media?parent=38792"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/categories?post=38792"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/tags?post=38792"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}