Paytm has announced the launch of its Forex service, for money exchange of 20 top international currencies on its platform. The company received the authorized dealership (AD Category II) from the Reserve Bank of India in April.
In a statement, Paytm said that the multi-currency (prepaid) Forex card and Forex cash can be ordered on a real-time basis, which can either be delivered to the user’s location within 48 hours or can be collected from any of its partnered seller’s outlets across India. Customers can load up to $250,000 in a financial year into the forex card, while the limit on currency notes is limited to $3000, Paytm said.
Paytm’s explained that customers can lock-in the prevailing exchange rates at the time of placing an order by making a 2% payment, with the flexibility to make the remaining payment at the time of delivery. Paytm also claims that customers will not be paying ‘any commission, service charge or hidden charges on their purchases’. However, according to an FAQ listed on the company’s website, GST of 18% will be charged on the taxable value as determined by the amount, categorized in three slabs. Paytm also said that customers can check the balance of their forex cards either online or in most ATMs abroad.
Although the service is only available through its website at the moment, it will be soon be enabled on the company’s mobile application, Paytm said in a statement. Paytm has partnered with CentrumDirect for this offering. It is worth noting that CentrumDirect was recently acquired by Ebix for about ₹ 1200 crores, a report by the Economic Times said.
Payments banks’ foray into Forex services
Earlier this year media reports pointed that other players in the category, such as Airtel Payments Bank , Fino Payments bank and Jio Payments Bank have also received the AD Category II license. An AD Category II entity is authorised by the RBI to offer currency exchange services and prepaid forex cards. While reports at the time suggested that these banks may also offer cross-border remittance services for customers, no such moves have been announced by either of the concerned companies.