Paytm to become the universal payment bank

Following the recent event of Vijay Shekhar Sharma-led Paytm wallet getting merged with Paytm Payments Banks, One 97 Communications has upgraded them to another level by integrating with IndiaStack.
IndiaStack is an open-stack platform that offers technology infrastructure for the Unified Payment Interface (UPI), eSign, digital lockers and electronic customer verification.
Paytm founder Vijay Shekhar Sharma who holds the licence for the operation of the Paytm payments bank has said that they have discovered a huge list of services that can be used, using the Aadhar card. Paytm already carries out 87% of the KYC verification biometrically through the Aadhar card.
As per the new development, any bank customer can scan the Paytm QR code and pay using UPI (Unified Payments Interface). The only difference in this process is that, instead of the Paytm wallet the money will be taken directly from the bank account. With this all Paytm merchant QR codes will be UPI-interoperable, enabling the merchants in the Paytm ecosystem to accept payments from other UPI apps. The UPI apps of different banks let users to transfer money between bank accounts using a virtual payment address without having to actually enter bank details. With the highest focus on UPI compliance and interoperability, customers will be able to refill their Paytm wallet through any UPI-enabled app, transfer money to any bank account from their existing bank account through Paytm’s UPI interface. This turns out to be a huge step for Paytm towards becoming the universal payment layer on every bank account.
Vijay Shekhar Sharma, the founder and CEO of Paytm had raised Rs 325 crore by selling one percent of his stake in One97 Communications. With this, he now owns 20.33 percent in One97 Communications. Mr. Sharma had earlier got an approval for the payments bank from the RBI on the condition that he holds 51 percent stake in the bank, for which he raised Rs 112 crore investments for his majority stake in the payment bank. They are currently in the process of obtaining final licence from RBI and will commence operations after obtaining due proposals.
The Chinese firm Alibaba and its subsidiary Ant Financial hold 40% stake in One 97 Communications with an investment of $680 million in the company. Alibaba’s Digital wallet Alipay is in a technology sharing partnership with Paytm. The Chinese conglomerate does not directly own a stake in the payments bank.
Since banks have their own mobile wallets, Paytm will have no problem in merging the payments business with the wallet business.One97 communications had incorporated Paytm E-commerce and Paytm Payments bank separately to make itself eligible for the in-principal approval from RBI. Wallet business will move to the payments bank while One97 communications will be managing the sales part for the wallet business.
Airtel has become the first entity to launch the payments bank in the country by rolling out a pilot of its banking services in Rajasthan. Post the demonetization move Paytm has emerged as one of the main gainers among its peers.

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