Noida-based digital payments company Paytm, owned by One97 Communications Ltd, has formed a five-member board for its payments bank, which went live on Tuesday, a company statement said.
PV Bhaskar, former executive director of the Reserve Bank of India; Ash Lilani, co-founder and managing partner at Saama Capital; and GS Sundarajan, a former director at Shriram Group, have joined the board as independent directors, the statement added.
Paytm founder and CEO Vijay Shekhar Sharma will act as a non-executive chairman, and Paytm Payments Bank CEO Renu Satti will also serve as a director on the bank’s board.
“We are privileged to have such imminent experts as mentors as we chart our way towards building India’s most trusted and consumer-friendly bank and bring half a billion Indians to the mainstream economy," Satti said.
Paytm has become the third entity to launch a payments bank in the country, after Airtel and India Post. The bank—which will roll out its services in a phased manner—has initially launched its operations in Delhi-NCR and will cover other top metros in the second phase.
The Paytm Payments Bank plans to expand its presence to 31 branches and 3,000 customer service points in the first year, the statement added.
Paytm Payments Bank is offering customers an annual interest rate of 4%, much lower than the 7.25% offered by rival Airtel Payments Bank. It will, however, also offer cashback on deposits.
Every customer who opens a payments bank account and has a deposit of Rs 20,000 will get cashback of Rs 250 instantly. Accounts can be opened with a zero balance. All online transactions will be free of charge.
In August, the Noida-based company created two separate entities—Paytm E-Commerce Pvt. Ltd and Paytm Payments Bank Ltd—to run its e-commerce and banking services, respectively. Paytm Payments Bank, which missed its original launch deadline, had been awaiting RBI’s final licence. According to media reports, the banking regulator had some concerns around its ownership structure.
Sharma will hold 51% stake in Paytm Payments Bank as the licence was issued in his name, while One97 Communications will hold the rest. Sharma and One97 Communications have together invested Rs 220 crore in the payments bank to date. Sharma has put in Rs 112 crore, according to media reports. For this, he also sold a 1% stake in the digital wallet’s parent firm One97 Communications to raise nearly $48.1 million (Rs 325 crore).