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To meet its ambitious target of achieving 50 crore users for its yet-to-be approved payments bank, Paytm has brought in Infosys to deploy its Finacle Core Banking Solution.
Paytm, which is a mobile commerce platform, will use Finacle platform for its deposit products and payments platform, enabling it to rapidly roll out innovative offerings, the company said in a statement.
Wipro will provide the integration of Finacle software with Paytm’s existing IT infrastructure.
Talking about why Paytm is using Infosys Financle despite being a large wallet player and a tech company itself, Shinjini Kumar, CEO of Paytm Payments Bank, said: “We aspire for people to not only transact with us (through the Paytm wallet) but also keep their savings with us. So we wanted to take what is best in the banking industry.”
Kumar said the company expects to start the Payments bank operations if it is able to receive RBI approval.
The challengeThree of the eleven companies that were given in-principle nod by the RBI to set up payments banks in August, including Tech Mahindra, Cholamandalam Finance, and the Dilip Shanghvi-IDFC Bank-Telenor joint venture, have already dropped out, making many question the business viability of a payments bank.
Kumar however, is highly upbeat, and said: “People dropped out because that was not their core business. For us, it is who we are and it is in our name.” She however pointed out that infrastructure challenges would prevail for the company, as the payments bank will be highly reliant on mobile infrastructure for transactions. “Business is difficult. Mobile data connectivity and call drops are still a challenge,” Kumar said, pointing out that better mobile infrastructure will boost the adoption of payments bank among the large unbanked population.
Recently, Infosys sought shareholders’ approval to transfer its Finacle and Edge Services businesses for ₹3,620 crore. India’s second-largest exporter wants to transfer the Finacle business for ₹3,400 crore and Edge Services for ₹220 crore.
It has 600 employees and its products and platforms are used by global corporations across industries such as financial services, insurance, retail and CPG, life sciences, manufacturing, and telecom.
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