The following article is based on my own interpretation of the said events. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post
D.Kalyani, MBA 2014-16, Vinod Gupta School of Management, IIT Kharagpur
On 13th March 2015, Mr. Ratan Tata’s personal investment in the mobile commerce company Paytm has made headline in the digital economy of India although the investment amount was not disclosed. With this investment, Tata has made five investments in the flourishing domestic e-commerce sector in the last seven months: online marketplace Snapdeal, jewelry e-tailer Bluestone, online furniture store Urban Ladder and auto classifieds portal CarDekho. Apart from that, Mr. Tata had also taken up the advisory role venture capital firm Kalaari Capital.
Paytm Founder and CEO, Vijay Shekhar Sharma had also expressed his pleasure to have Mr. Tata as an advisor for Paytm. Its aim is to grow the number of mobile wallets to 100 million by the year-end from 25 million active wallets, with an average wallet balance of Rs 150.
Other than facilitating a mobile commerce platform, it works in mobile recharges, tickets and deals. It has also tied up with the likes of taxi hailing app Uber, ticket booking portal Bookmyshow, travel booking platform MakeMyTrip and food ordering service FoodPanda among others.
Paytm has announced that it will introduce Immediate Payment Service (IMPS) on its platform, wherein users can use mobile wallets to transfer money to any bank account. The company will also open about 50,000 retail outlets where users can load cash in their mobile wallets. In order to avail the wallet to bank account transfer facility, a user has to be mobile or e-mail verified and registered on the system for over 45 days. The balance in the Paytm wallet must be a minimum of Rs. 2,000 and the transaction amount should exceed Rs 1,000. The daily upper limit for wallet to bank account transactions is Rs 5,000 and the monthly limit is Rs 25,000, the company said in a statement.
With all these moves, Paytm is going to make big in domestic m-commerce which enables users an efficient mobile payment platform. Ratan Tata’s bullish step clearly shows India’s fast-growing e-commerce market.