Paytm Money, the payments company’s wealth management arm, is reportedly set to commence operations in the next six to eight weeks. According to a report on the Economic Times, the company received the approval of the Securities and Exchange Board of India (SEBI) last week, along with a dozen other asset management companies (AMCs).
The new company will be headed by Pravin Jadhav as senior vice-president. Jadhav, who previously worked with Rediff and social networking site Wishberg, had said that Paytm Money will be an entirely technology-led digital product without any offline presence.
Paytm Money plans to integrate 10-12 AMCs on board the platform before commencing operations and will try to add 30-35 more within the next 12 months, Jadhav told ET. The service will be launched as a separate app on various app stores, he added.
Jadhav said he wants to build Paytm Money, unlike the parent Paytm app, as an engagement product where customers will come for much more than only transactions, since wealth management is a different business altogether.
According to ET, Paytm plans to target an average investment of Rs 1,500-2,000 per user versus the industry average of Rs 30,000-55,000. By targeting lower investments the company wants to reach consumers beyond the top 15 urban locations.
To start with, it may offer mutual fund products to users and is in discussions with asset management companies to offer these products. Paytm Money plans to capitalize on relatively low investment in the product and double its market share in two years, according to Jadhav.
Paytm’s other recent splashes
Last month it was reported that Paytm is closer to offer insurance products on its platform, as its parent One97 Communication Ltd has set up two insurance units: Paytm Life Insurance Ltd and Paytm General Insurance Corporation Ltd. The development was found in the company’s ministry of corporate affairs’ filings. According to the filings, the company’s founder Vijay Shekhar Sharma, and senior executives Shankar Nath and Madhur Deora will be the directors of these units.
In a separate development, the company is reportedly also launching a credit scoring product called Paytm Score, which will find out user’s credit score based on their transactions and payment behaviour. This move is in line with its interest in credit or loan segment.
Remember, Paytm has a payments bank licence, but they are not allowed to give out loans from their own books but are allowed to partner with other financial institutions to source loans for them.