Paytm to launch payments bank by March 2016

The mobile wallet company Paytm will launch a payments bank by FY16-end. The company's promoter, Vijay Shekhar Sharma, was one of the individuals (and entities) to get an in-principle nod from Reserve Bank of India to set up a payments bank, among several others.

Other entities include, Reliance Industries, Vodafone, Bharti Airtel, Sun Pharma, Tech Mahindra, Cholamandalam Finance, among others.

Payments Banks have been pegged as a tool to aid financial inclusion, extending financial help to MSMEs and SMEs.

Also read: All you need to know about payments banks

Here, customers can open small savings accounts, and the banks will be allowed to issue debit and ATM cards. While customers can only deposit up to Rs 1 lakh, these banks will not be allowed to carry out lending activities.

Paytm boasts of over 80 million registered users, placing up to 60 million orders per month.

One 97 Communications, Paytm's parent company, is also one of the companies that Tata Group Chairman Emeritus chose to invest in. The company's other investors include, Ant Financial (Alibaba's AliPay), SAIF Partners, Sapphire Venture, and Silicon Valley Bank.

Also read: Paytm founder invests in Rahul Yadav's new venture