It’s been a windfall for mobile wallet and payment bank company Paytm since the government recalled Rs 1000 and Rs 500 notes. The government’s push for a cashless economy has not only helped the company expand its customer base manifold but has also made it a household name. In an interview to Hindustan Times, the Paytm CEO Vijay Shekhar Sharma talks about how his company is gearing up to allay customers concerns over cyber security and other issues.
Q) There is a lot of apprehension about security while using mobile/online banking? How is Paytm addressing security concerns of customers?
A) At Paytm banks, we are making sure no individual is able to get defrauded. This is not to say that somebody with a bank account can’t be defrauded. I am talking of bank account of ours. So nobody can on phone call and say that I am calling from PayTm bank and I want your bank account or OTP number because we are removing the concept of OTP from our banking process. That is the biggest thing that we are doing. There is only one way to learn about security, which is about the systems to have a blockage of elements that are leaky. For example if you give consumers any information which they can share with others by mistake. So, we are removing the concept of shareable tokens. OTP are shareable token. Also another thing that people do not know is that every bank account up to Rs one lakh is insured by RBI and I don’t think people take this into consideration. We are one of those rarest regulated and controlled countries in the world where even the regulator has insured your money.
Q) While pushing for mobile banking, how do you plan to deal with poor mobile/internet connectivity issues?
A) There are two elements to it. One is how the cyber security is going to work and the other is how customers who do not have phone will be able to use it. One of the things that we have done is we have created a toll-free number-based banking and payment service (1800 1800 1234). And, as we speak, we are getting at least hundreds and thousands of calls a day there and serving them. This is not yet popular but we believe that toll-free phone banking is going to be one of the main interfaces in our banking service and for authentication we will do biometric verification. So one will need mobile connectivity but data connectivity is not an obligation.
Q) You are taking micro ATMs to each and every village. How is it going to work considering the low internet penetration in rural areas?
A) We are expecting that every village will have an internet and app connection. That is a fundamental understanding in this conversation. We are giving them biometric dongles. Then the app on our platform will allow them to cash in and cash out.
Q) You are moving the wallet as part of the bank. What sort of a deposit base you are looking at?
A) Right now we are talking about 17 crore customer with Paytm. We have set Q1 of next year as our timeline. I believe we should have at least 25 to 30 million customers in the first year for sure. As for the deposit base, in terms of cash account we have 25 to 30 million in the first year. In terms of value term, see Paytm bank is totally addressing a new customer base which has not been looked at by traditional banks. Traditional banks also have a corporate account, savings account. I don’t think I am yet going to say this number because we are yet to see what the numbers are going to come. But right now I can say that Paytm itself has more than Rs 1000 crore in its wallet account. Right now Paytm gets deposits of anywhere between Rs 122 to Rs 150 crore every day in its account and on a cumulative basis the residual balance has started reaching up to Rs 1000 crore.
Q) Since November 8, how much has your user base gone up?
A) We started at 15 crore and we are now 17.2 crore.