Paytm will be bigger than a traditional bank, says Vijay Shekhar Sharma

Paytm’s payments bank expects to hit 500 million CASA accounts by 2020, more than double their current count of 200 million wallet users who’ve been transferred to the new payments bank format. “In the next 3 years, we’re going to be bigger than the biggest traditional bank in India,” Vijay Shekhar Sharma, Founder and CEO, Paytm, said.

Sharma was speaking on the sidelines of the Alibaba Group Global Netrepreneur Conference in Hangzhou, China. Alibaba is a majority stakeholder in One97, Paytm’s holding company.

Sharma said the company invested $500 million in the last year to increase usage, which paid off during demonetisation. Now, its network is larger than that of all card companies put together.

Speaking to BusinessLine, Sharma indicated that the future holds closer partnership for his e-commerce company Paytm Mall with Chinese e-commerce and payment giant Alibaba.

“I want to give a larger market to Indian SME enterprises by giving them access to markets abroad, with cross-border commerce. I think Indian brands and Indian companies can go global. Consumption in China is large, I want Raymond, Eicher motors to be selling here. That’s why we’ve recently opened an office in Hangzhou,” he said.

Alibaba’s TMall gives foreign brands access to Chinese buyers even if these companies aren’t officially registered in China. Paytm wants to do something similar for Indian brands looking for bigger markets abroad. On logistics, Sharma said Paytm can do shipping in 7 days between countries.

“If the sale happens in India, Paytm will be used to do the settle. If it happens in China, we’ll use Alipay. There’s no aggregator for wallets globally but Ant Financial’s ecosystem (Alibaba’s financial services arm) acts like an aggregator. If Apple connects to Alipay, you have access to anybody with Alipay tokens,” he said.

The challenges in growing the payment network are the language difficulty at the merchant level and cross border currency restrictions. Regarding a news report on Paytm’s likely investment of $200 million in e-grocer Bigbasket, Sharma said, “We’ve never built a category by buying, this track record will remain. investments are for hedging. We’re looking at the O2O model (online to offline) and fast deliveries by businesses close to the customer.”

Shekhar also added, “If we acquire a company, it’ll be for the talent, not for the business. Our travel business is bigger than makemytrip and ibibo combined. Our movie ticket business is 60 per cent of bookmyshow.”

As online companies battle for supremacy in the Indian market, Sharma said the rush to raise fast PE money has slowed down. Paytm raised another $200 million from Alibaba and venture fund SAIF Partners in March. “$200 is not a small amount, if we are not reckless. Earlier, there was a chase to raise more money. Now, it is about long-term capital, so companies are not burning money. We have the backing of long-term investors.”

However, profitability is not an immediate goal, Sharma added, saying right now, the goal till 2020 is just growth.

The writer is in Hangzhou at the invitation of Alibaba.