Paytm, a mobile payment services and e-commerce firm, is in talks with ICICI Group — ICICI Bank, ICICI Prudential and ICICI Lombard — to launch its payments bank operations.
The company is also said to be negotiating with Citibank, IndusInd and other small-finance banks for its new business. It is close to finalising its banking, insurance and mutual fund partners for its payments bank services, which is likely to commence this summer.
Besides, Paytm is also in talks with SBI Mutual Fund and IIFL for its banking services.
“The company is currently evaluating potential tieups, but none of the partners had been finalized yet,” Varun Khullar, head, partnership division, Paytm, told The Economic Times.
In August last year, Vijay Shekhar Sharma, founder and chief executive of One97 Communication that owns Paytm, was among the 11 applicants to receive “in-principle” approval by the Reserve Bank of India (RBI) to open payments banks.
“Although we want the perfect fit for ourselves, we are also wary about the fact that we don’t want too many partners on board because technical integration is going to be a time consuming and difficult task,” said Khullar.
The company has rolled out an internal project named “Project Pokhran” to recruit people and set up offices for payments bank services. Global consultants EY (Ernst & Young) and McKinsey are the advisers to the company for its new business.
Paytm is looking to “mobilize” about one million business correspondents to grow its payments bank business.
Payments banks can accept cash deposits, permit remittances and roll out “simple financial products”. They can accept savings deposits up to Rs 1 lakh from a customer, but is not allowed to lend to customers like commercial banks.
Earlier, Paytm had planned the launch of the service by April 2016, but now the company has reportedly delayed the roll out as it awaits the “go-ahead” from the RBI.
The company will have its banking headquarters in Noida (NCR), and plans to set up 20 branches for the payments bank.