Mumbai: According to a regulatory filing to the stock exchanges, One 97 Communications, the parent company of digital payments firm Paytm, has partnered with Piramal Capital and Housing Finance to further expand its merchant loan business to small towns and villages. Paytm stated that with the agreement, merchant partners would be able to obtain financing valued up to Rs 10 lakh, with periods ranging from 6 to 24 months. According to the company, the agreement will soon be expanded to include personal loans. Loan distribution is a significant source of revenue for Paytm.
For the quarter ended June 30, Paytm reported Rs 271 crore in revenue from financial services, primarily loan distribution. The company’s financial services revenue also includes what it makes from wealth and equity trading on Paytm Money, apart from other services.
Bhavesh Gupta, Chief Executive of Lending, Head of Payments, Paytm, said, “We continue to see rapid growth across all our lending products, where we empower MSMEs from smaller cities and towns with access to digital credit. The success and scale of our lending products gives us the confidence to expand and further boost our credit offerings. Our partnership with Piramal Finance is another step in that direction.”
For the April-June period, the total number of loans disbursed by Paytm in partnership with partners stood at 8.5 million, amounting to Rs 5,554 crore. Of this, the total value of merchant loans on the platform stood at Rs 827 crore.
Jairam Sridharan, Managing Director, Piramal Capital and Housing Finance Ltd, said, “We aim to cater to the lending needs of the merchants in the Bharat markets through a variety of products that are relevant to this core segment. Many of these merchants are loyal Paytm customers and this partnership will bolster our proposition through a mix of technology and network of branches located in tier-2 and tier-3 towns.”
With 309 operating branches, Piramal is looking to expand further, as it looks to be present in 1,000 towns and cities. The company is adopting a ‘phygital’ strategy which includes digital and physical to grow its retail lending business.
