Paytm Payments Bank reports Rs 30.7 Cr loss prior to launch of operations

Paytm

In the first year of setting up the payment bank service, Paytm has suffered a loss of around Rs 30.7 crore between August 2016 and March 31, 2017, according to a document filed with the Registrar of Companies (RoC) show.

Paytm Payments Bank incorporated in August last year, started operations from the month of May this year. As per the documents, the company had an overall revenue of close to Rs 2.47 crore during the period under review.

However, the company refused to make any comment on this development.

Last month, according to media reports, Paytm Payments Bank had raised $9.3 Mn from One97 Communications founder Vijay Shekhar Sharma and other existing investors.

At the time of the launch, it had received an initial investment of $34.2 Mn. Sharma is the majority shareholder in the payments bank.

Sharma has invested $4.6 Mn in its payments bank, while One97 Communications has contributed around $3.5 Mn.

The Paytm Payments Bank is expanding footprints gradually and aims to spread across metro, urban, semi-urban and rural areas. It has proposed to set up 31 branches, 33 controlling offices and 3,000 access points by March 31, 2018.

The Reserve Bank of India had awarded in-principal nod to 11 entities for setting up payments bank operations with the objective of deepening financial inclusion in the country.

There are now three payments banks in the country, including Airtel Payments Bank Ltd and India Post Payments Bank Ltd.

Payments banks allow customers to open savings accounts for deposit amounts of up to Rs1 lakh.

On savings accounts, Paytm Payments Bank is offering 4 percent per annum interest. Its competitor Airtel Payments Bank gives 7.25 per cent per annum on savings accounts, while India Post Payments Bank provides 5.5 percent interest per annum.

Paytm Payments Bank’s interest rate is in line with large commercial banks, such as State Bank of India and ICICI Bank Ltd, which offer 4 percent on savings account deposits. Some of the smaller banks, such as Yes Bank Ltd and RBL Bank Ltd, offer 5.5-7.1 percent interest on savings accounts, depending on the deposit amount.

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