Digital payments company Paytm is now looking at entering the employee benefits space. Paytm will be launching a Food Wallet where companies will be allowed to load food allowance to employees under the government’s approved tax redemption bracket. The Food Wallet will be available in the Paytm app as a separate section in the pass book which will have the details of the allowance.
Paytm says that it will be now deploying sales teams to onboard corporate clients. Employers can transfer money to the Food Wallets of employees. Employers can opt for a daily, monthly or quarterly payout option. It added that the solution is already live at 10 corporate offices, as indicated by this Economic Times report. But a company spokesperson declined to give further details. The report added that Paytm is looking at getting around 6 million employee base.
Paytm’s Food Wallet can be used at office cafeterias and also at online and physical merchants including small standalone outlets.
In the employee benefits space, Sodexo is the largest in terms of having corporate clients with over 10,000 followed by Edenred (which runs Ticket Restaurant) with 3,500 clients. Meanwhile, Bhavin Turakhia-backed Zeta has over 650 corporate clients and claims over 100,000 end users.
Note that Sodexo has opted to set up their own proprietary acceptance network as part of efforts to digitize their meal vouchers. The company has opted not to partner with any card networks and issue a separate POS terminal to all merchants on its network. This was done to maintain tax compliance and ensure that only payments for food and non-alcoholic beverages can happen on their meal cards.
Also read: How Sodexo is going digital in India
Paytm’s new business comes close on the heels of the Reserve Bank of India’s draft guidelines which said that they cannot be issued in paper form anymore and will have to move to digital means by the end of 2017.