Paytm Payments Bank offers free IMPS, NEFT, RTGS transactions; aims half-a-billion users

Paytm on Tuesday formally launched Paytm Payments Bank. India's largest digital wallet firm, which aims to bring half-a-billion Indians into 'mainstream economy', is now offering accounts holders of Paytm Payments Bank benefits like zero-balance account, free IMPS, NEFT, RTGS, UPI transactions and a complimentary virtual Rupay cards for online transactions. Paytm had announced a beta launch of its payments bank in May this year.

Paytm Payments Bank account holders will earn an interest of 4 per cent on savings every month. Besides issuing a free Rupay digital card at the time of account opening, Paytm account holders will also be offered a free insurance cover of up to Rs 2 lakh in case of death or permanent disability according to the terms and conditions, Paytm said.

The account holders of Paytm Payments Bank can also ask for a physical Rupay card, which will cost Rs 100 with additional delivery charges. Account holders will be able to view their transactions and balance in real time in Paytm Passbook.

To facilitate verification of account holders, Paytm plans to invest $500 million in KYC (Know Your Customer) operations. It is setting up KYC centres across India to complete the KYC formalities for customers and make them eligible for a payments bank account. A user can add up to Rs 20,000 in a calendar month in Paytm Wallet. However, a KYC (Know Your Customer) verified user can maintain up to Rs 1,00,000 at any point of time.

Finance Minister Arun Jaitley, during the inauguration of the Paytm Payments Bank on Tuesday, said the modern technology had changed the entire dynamics the way banking was done in the country. Payments Banks are a new set of differentiated banks introduced by the Reserve Bank of India to extend deposit and payments services to millions of unbanked and underbanked Indians.

"In the last 2 years and the next three years, we would have invested Rs 18,000-20,000 crore. I don't want to talk about profitability right now because we are still in an investment phase," Paytm founder and CEO Vijay Shekhar Sharma said. Sharma said its platform processes about 250 crore transactions annually worth of Rs 80,000 crore. "We expect this to grow to Rs 1 lakh crore by the end of the fiscal. The number of merchants on our platform will also touch 60 lakh in a few months," Sharma added.

Although the payments bank can't offer financial products of their own as a business entity, it can act as a business correspondent and partner with other financial institutions and banks to offer loans, fixed deposits, insurances and mutual funds. "We invest deposits only in government bonds. None of your deposits will be converted in to risky assets," the company said in a press release.

Paytm had earlier tied up with private sector lender ICICI Bank to offer its customers up to Rs 20,000 interest free credit for the first time for everyday use ranging from movies to bill payments to flights and white goods. The amount would remain interest free for a period of 45 days. Thereafter, an interest of 3 per cent will be levied, it had said.

All you need to know about Paytm Payments Bank

You can add a nominee to your account. In case something unforeseen happens to you, your nominee will get the balance in your account. Your bank account details inside the Paytm app are protected with a passcode. Paytm passcode is a 4-digit numeric code, which acts as an additional security check to authorise access to your bank account details or transactions.

STEPS TO OPEN YOUR SAVINGS ACCOUNT

Launch your Paytm app.
Go to the 'Profile' or 'Passbook' section.
Choose the option to open a bank account.
Set a passcode (if not setup already) and provide nominee details for your account.
If you are a non-KYC customer, book a KYC visit as part of the account opening process.

ATM Transactions

Non-metro Locations: 5 free every month; post that cash withdrawal: Rs 20/transaction
Mini statement, Balance check: Rs 5/transaction
Metro Locations: 3 free every month; post that Cash withdrawal: Rs 20/transaction
Mini statement, Balance check: Rs 5/transaction

Digital RuPay Debit Card: Free
Annual subscription for physical RuPay Debit Card: Rs 100 and delivery charges, and Rs 100 annually thereafter
Cheque book (10 leaves): Rs 100 and delivery charges

Charges on Paytm Wallet
Paytm Wallet to Bank Transfer - Basic Customer 3 per cent
Paytm Wallet to Bank Transfer - KYC Customer 3 per cent