Yahoo Finance Infosys (INFY) Finacle to Run Paytm's Payment Bank Venture
Infosys Limited’s INFY wholly owned subsidiary EdgeVerve Systems’ prominent banking solution Infosys Finacle has been recently chosen by the largest mobile payments & commerce platform Paytm to support its new payments bank business.
Paytm Deploys Finacle
Leveraging on the competence of Finacle Core Banking, Paytm plans to launch innovative offerings by boosting its deposit products and payments platform. Infosys asserts that the use of Finacle will allow Paytm to integrate its payments bank services, create comprehensive CaSa (Current Account and Savings) based products and simplify operations. Adoption of banking services necessitates Paytm to comply with multiple industry standards and Finacle is well equipped to handle all such needs.
With the help of Finacle, Paytm can enjoy many third-party applications like Anti-Money Laundering and even scale and manage expanding operations. Paytm has chosen Infosys’ Finacle over other competitive solutions as it believes it is the perfect choice to create a competent platform for small value and high volume transactions. In a nutshell, Infosys is aiding in the digital transformation of Paytm to venture beyond its wallet business to a full grown payment bank that is currently revolutionizing the Indian banking sector.
Payment Bank Revolution to Benefit Infosys
Payment Banks and Small Banks are Reserve Bank of India’s (“RBI”) idea of financial inclusion. These cater to the credit requirements and remittance needs of the country’s small businesses, unorganized sectors, low-income households, farmers and migrant work force. Infosys foresees thriving prospects in this space and has introduced Finacle Payments Bank and Finacle Small Finance Bank solutions in Sep 2015 to cash in on the bountiful opportunities.
With leading organizations like Reliance Industries and Airtel M Commerce in India vying for licenses from the RBI to set up payment banks, Infosys Finacle will likely witness great demand for use in the process of digital transformation of these companies. During the fourth quarter of fiscal 2016, the EdgeVerve unit had 18 wins and 24 “go-lives” for both the Finacle and Edge suites that will likely boost profits. These contract wins are expected to drive the top line in the upcoming quarters.
According to a Business Standard article, Infosys expects EdgeVerve, its wholly owned subsidiary, which is also the parent company of Finacle, to contribute at least 10% to its overall revenue growth over the next 3–5 years. With 70% of the top 40 banks in India using the platform, Fincale is not only EdgeVerve’s most successful offering but is also a primary growth driver for the company.
Infosys currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the industry include CoStar Group Inc. CSGP, EarthLink Holdings Corp. ELNK and RELX NV RENX. While CoStar Group and EarthLink Holdings sport a Zacks Rank #1 (Strong Buy), RELX NV holds a Zacks Rank #2 (Buy).
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