One97 Communications, the parent body owning the digital wallet Paytm and retailing arm Paytm Mall, which also started the Paytm Payments Bank (PPB) has now launched an investment advisory firm Paytm Money.
Pytm Money is envisaged as a pureplay online business which will offer a wide range of financial services, including cross-selling of the products of Paytm Payments Bank. An application to start this advisory firm has already been filed with the Securities and Exchange Board of India (SEBI) for its approval.
In a blog post, the company said that the purpose is to build Investment and Wealth Management products for its users. “We plan to launch its products in the first quarter of 2018 after regulatory approvals.” it said.
One97 Communications has chosen Pravin Jadhav, formerly with Rediff and Wishberg to head this new advisory venture. He says that Paytm Money will offer the products directly to customers and not charge any commission from the funds.
Pravin Jadhav, head of Paytm Money
“We started as a payments platform and expanded customer offerings to deposits with Paytm Payments Bank. Today, with Paytm Money, we have taken the next logical step in the direction of wealth management. Pravin and his team is on a mission to make wealth management easier and accessible to large number of Indians. We aim to increase the size of wealth management customer base and bring simple and easy to understand wealth products to our consumers,” Vijay Shekhar Sharma said.
Paytm Money will cover the entire spectrum of wealth management and plans to add more investment offerings going forward.
This follows a SEBI directive earlier that sought to draw a distinguish between distributors of financial products earning commissions from the fund managers or remain advisors claiming consultation fees from the customers who seek their services. Paytm Money has chosen to remain an advisory firm in scope and practice. It could beef up its revenue by charging a small transaction fee for the investments being made using its online platform.
It is not clear how much One97 has invested in Paytm Money, but reports suggest that it has invested about over Rs 63 crore. It will own 49% in the payments bank venture. According the Jadhav, they had sent in their application for starting the operations of Paytm Money to SEBI in November 2017 and are waiting for the approval. He also disclosed that they have already recruited around 40 people and hope to take the headcount to 200 soon.