Paytm founder prepares for his next pivot, which could be the biggest yet

Paytm also has a licence from RBI to launch a 'payments bank,' reports Tech in Asia

 “The last five years were an opportunity for those who were capturing Indian consumers, because people got internet connections with smartphones,” Paytm’s founder and CEO Vijay Shekhar Sharma tells me, his easy chuckles complementing the sunny poolside of a Delhi hotel. “The next five years are an opportunity for companies capturing Indian small and medium businesses (SMEs) as they begin to understand how important smartphones are to their businesses.”

The latest instance is the cash crunch in India, following the sudden withdrawal of high denomination currency notes and scarcity of replacements. This was a windfall for Paytm, which started seeing half a million new users on its digital wallet every day.

Paytm launched a new feature to let merchants who don’t have card-swiping machines to accept card payments on their wallet. 

Seizing the moment

Vijay was no longer thinking linearly about growing the 160 million users on Paytm. He was thinking of the hundreds of millions of others who didn’t have Paytm in their phones, but did have bank accounts and debit or credit cards. They would all face the problem of making payments to merchants who had no card-swiping machines. If Paytm could solve their problem, it had a potential for exponential growth.

Only the nimble can survive

Last year, Paytm introduced QR codes for merchants which customers could scan for payments. It claims to have enabled a million offline merchants to accept digital payments via QR code.

Now, the Indian government has asked Visa, Mastercard, and RuPay to come up with a common QR code for merchants to accept cashless payments. Customers can then scan the QR code with their preferred card payment gateway app.

New, new possibilities

It’s not just the consumer-merchant user base Paytm is targeting either. APIs (application programming interfaces) create all sorts of possibilities. 

Paytm also has a licence from the Reserve Bank of India to launch a “payments bank” – a new entity in India where the bank is restricted to payments. 

This is an excerpt from Tech in Asia. You can read the full article here