Paytm’s payment instruments have helped the company

 Paytm’s payment instruments have helped the company 

build a multi-stack payment architecture and bring it revenue

 

 

India’s leading digital payments and financial services player Paytm filed its Draft Red Herring Prospectus for its $2.2 billion Initial Public Offering on 15^th July 2021. The prospectus gives an insight into the business model of the company and how Vijay Shekhar Sharma has envisioned building India’s largest financial services giant. 

 

One of the interesting aspects is how Paytm has built its flywheels to create a complete network effect and a multi-stack payment architecture. 

 

Paytm has built a strong base in India, with multiple payment instruments. These instruments include prepaid payment instruments such as Paytm Wallet, sub wallets and prepaid card; Savings account, current account, debit cards, FASTag, National Common Mobility Card, and Unified Payments Interface (“UPI”) handle, which are issued or opened by Paytm Payments Bank, and Paytm Postpaid, equated monthly instalment, credit cards, amongst others, issued by our financial partners. The company has listed the same in its competitive strengths, as it said, “Our payments platform, with a wide selection of daily life use cases and payment instruments, provides us with large scale and reach.”

 

It is the only payments company in India, along with its affiliates who own each layer of the payment stack. The power of these payment instruments is that it gives Paytm revenue. “Given the comprehensive nature of our payments platform, we believe that we have better ability to monetize the payments business because we are not dependent on one or few payment methods where monetization potential is low or zero. Some of the payment instruments like credit cards and payment methods like in-store devices have a much higher monetization potential than the more widely used payment forms,” the company said in its DRHP. 

As stated in the company’s DRHP, Paytm is the largest payment gateway aggregator in India based on total transactions, for the fiscal year ended March 31, 2021, with the widest ecosystem of payment instruments.

 

Additionally, this also gives users the flexibility to choose between different payment instruments and pay as per their convenience.

YES BANK launches ‘Yuva Pay’, a unique

YES BANK launches ‘Yuva Pay’, a unique digital wallet for smart phone and feature phone users in partnership with UDMA Technologies

YES BANK announced the launch of ‘Yuva Pay’, a unique digital wallet in partnership with UDMA Technologies to enable contactless payments. This collaboration is in line with YES BANK’s fast-track innovation efforts of enabling communities to experience the convenience of digital banking services – as the nation slowly begins to unlock after the COVID-19 lockdown.  This innovation is a digital wallet issued under minimum KYC regulations, combined with bill payments via Bharat Bill Pay and Unified Payments Interface (UPI).

Through the app, utility bills like municipal, house, water tax, electricity, LPG, DTH, Mobile bill, license fees, Windmill & Solar park fees, building sanction fees and billboard taxes can be paid along with insurance renewal, fastag recharge, EMI payment, school fees and use at retail outlets. The first live program of the solution will be implemented by State Rural Development & Panchayat Raj Department, Karnataka and the first phase will cover 158 gram panchayats with 238 villages. Subsequently, this program will be rolled out to 6200 gram panchayats covering 12 million households across 29,000 villages in the second phase.

Speaking on the launch, Anita Pai, Chief Operating Officer, YES BANK, said, “This unique endeavour is yet another step taken by YES BANK towards achieving the Government’s vision of Digital India by converting all paper transactions into paperless digital transactions. The program also aims to make the low income groups transition to digital and contactless transactions by enabling wider access to secure electronic payment services.”

Prashanth Naik, CEO, UDMA Technologies, said “We envisage a long lasting business relationship. YES BANK is one of India’s leading digital payments facilitator and we intend to replicate this solution across the country, specifically in the rural segment where internet connections maybe an issue and feature phone is prevalent. Together, we now offer India’s strongest offline wallet solution that not only brings the world’s best payments experience to Indian Citizens, but is an important step towards eventually having cashless transformation in India.”

To activate the unique feature, customers need to follow a simple process:

Feature Phone Users

Users to visit the nearest ‘Yuva Mitra’ associate to complete minimum or full KYC verification process. Once the verification is complete, the wallet is activated and users can start using their services through Interactive Voice Response Services (IVRS) wherein all transactions are processed securely via OTP & T-PIN authentication.

Smart phone Users

Users can download the ‘Yuva Pay’ mobile application from Android play store, complete the minimum KYC requirements and add money to their wallet. As per RBI guidelines, the user will need to complete biometric based KYC process within 24 months after wallet activation. If internet connection is available, users can start using the services online while in case of no internet connection, the payment and collection request is converted into an encrypted SMS and the transaction is completed in offline mode.

The app ensures contactless payments as it works on a unique algorithm based protocol. It sends data securely to the Bank on real time basis, resulting in a seamless transaction for the user without depending on internet. Yuva Pay also doubles up as a banking app for funds transfer, account balance check, recharges or top ups, bill payments and rewards platform. It allows contactless as well as payments between users in proximity, while maintaining adequate social distancing norms.