Paytm an Indian e-commerce company is growing at the fast pace. The young portal which was just launched in 2010 had a significant growth spurred by demonetisation and that is the turning point in its life.
Founded by Vijay Shekhar Sharma, the company initially started as a prepaid mobile recharge website developed into an online payment system with wide range of systems covering mobile recharge, utility bill payment, wallet payment and wallet to bank transfers etc. It has been acquired by big business model as well Alibaba Groups who invested $575 Mn with 25% share in the company and Ratan Tata supports the company. The current market value of Paytm is $3Bn.
Big business houses like State Bank of India and HDFC are upset about the causes in their premises and stated that the” e-wallet like Paytm has no future”.
Aditya Puri the Chief and Managing Director of HDFC Bank said at the annual Nasscom Summit ” I think wallets have no future. There is not enough margin in the payment business for the wallets to have a future”. He added ” Wallets as a valid economic proposition is doubtful. There is no money in the payments business. The current loss reported by market leader Paytm is ₹1,651 Crore. You cannot have a business that says pay a ₹500 bill and take ₹250 cash-back”.
Vijay Shekhar said that the company is currently with 190 Million accounts in comparison to SBI with 202 Million. This statement took a wrong hold on business tycoons maybe and the delivery of speech in Nascoom Summit was the result. Even HDFC Bank holds an e-wallet Chillr which is seriously facing troubles with its competition Paytm in the market. Paytm has faced numerous troubles from the leading banks blocking customers to transfer cash to the company.