Paytm announces launch of small ticket loan product Postpaid Mini

Digital payments and financial services platform Paytm on Monday announced the launch of Postpaid Mini, small ticket loans that will give users flexibility to access loans ranging from Rs 250 - Rs 1,000, in partnership with Aditya Birla Finance Ltd.

The product is an extension of its Buy Now, Pay Later service, driving affordability amongst those new to credit. These small ticket instant loans will give flexibility to users and also help manage their household expenses to maintain liquidity during the ongoing Coronavirus (Covid-19) pandemic. 

With this service, Paytm Postpaid is offering a period of up to 30 days for repayment of loans at 0 per cent interest. There are no annual fees or activation charges, only a minimal convenience fee.

Bhavesh Gupta, CEO - Paytm Lending said, "We want to help new-to-credit citizens start their credit journey and develop a financial discipline. Through Postpaid we are also making sincere attempts to help drive consumption in the economy. Our new Postpaid Mini service helps users manage their liquidity by clearing their bills or payments on time."

With the launch of Postpaid Mini, the company will offer access to loans ranging from Rs 250 to Rs 1000, in addition to Paytm Postpaid’s instant credit of upto Rs 60,000. This could help users pay for their monthly expenses, including mobile and direct to home (DTH) recharges, gas cylinder booking, electricity and water bills, shop on Paytm Mall and more. 

Through Paytm Postpaid, its existing offering, users can pay at online and offline merchant stores across the country. Paytm Postpaid is currently accepted at thousands of petrol pumps, neighbourhood kirana stores or pharmacy shops, popular chain outlets (such Reliance Fresh, Apollo Pharmacy, etc), internet apps (such as Myntra, Firstcry, Uber, Dominos, Ajio, Pharmeasy, etc) and popular retail destinations (such as Shoppers Stop, Croma, etc) among others. Paytm Postpaid is available in over 550 cities in India.

Ahead of its initial public offering, Paytm is looking to capture as much of the financial services market as possible. 

The firm is planning to raise $3 billion (around Rs 22,000 crore) through its IPO. The IPO plan received in-principle approval from Paytm's Board in May. If successful, this could be the biggest initial public offering (IPO) by an Indian company, breaking Coal India’s 2010 record of  Rs 15,475 crore.

Paytm is also targeting a valuation of $25 billion to $30 billion, 1.5-1.8 times the current valuation of $16 billion.

A recent report by Bernstein Research says that Paytm is not just a financial app provider, but a group of synergistic fintech platforms. It further said Paytm's businesses such as PFG also act as "complimentary customer acquisition and monetization opportunities".