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Shares of fintech firm <keyword id="181441" type="General" weightage="20" keywordseo="One97-Communications" source="Orion">One97 Communications</keyword> -- the owner of <keyword id="19898109" type="General" weightage="100" keywordseo="Paytm" source="keywords">Paytm</keyword> brand -- jumped 5 per cent on Thursday morning after the company received the government's approval for downstream investment in wholly-owned subsidiary <keyword id="22960487" type="General" weightage="20" keywordseo="Paytm-Payments-Services-Ltd-" source="keywords" meta.keywordsubtype="org" meta.entityname="Paytm Payments Services Ltd." meta.hostid="261" meta.entityid="Paytm Payments Services Ltd.">Paytm Payments Services Ltd.</keyword> The stock climbed 5 per cent to Rs 565 on the BSE. At the NSE, it surged 4.98 per cent to Rs 564.80. The company will reapply for a <keyword id="6640986" type="General" weightage="20" keywordseo="payment-aggregator" source="Orion">payment aggregator</keyword> (PA) licence, a regulatory filing said on Wednesday. "We would like to inform you that <keyword id="20410230" type="General" weightage="20" keywordseo="PPSL" source="keywords">PPSL</keyword> has received approval from the government of India, <keyword id="156153" type="General" weightage="20" keywordseo="Ministry-of-Finance" source="Orion">Ministry of Finance</keyword>, Department of Financial Services, vide its letter dated August 27, 2024, for downstream investment from the company into PPSL. "With this approval in place, PPSL will proceed to resubmit its PA application. In the meantime, PPSL will continue to provide online payment aggregation services to existing partners," Paytm filing said. The Reserve Bank of India (RBI) had rejected Paytm's PA licence permit application in November 2022 and instructed the company to reapply with Press Note 3 compliance under the foreign direct investment norms. As per Press Note 3, the government had made its prior approval mandatory for investments from nations that share land borders with India.

Paytm shares jump 5% on receiving government's nod for investment in Paytm Payments Services

In its next meeting, slated for 9th September, the GST (Goods and Services Tax) Council may decide over imposing an 18% charge on <keyword id="20157806" type="General" weightage="20" keywordseo="payment-aggregators" source="keywords">payment aggregators</keyword> (PAs) like <keyword id="20290089" type="General" weightage="20" keywordseo="Razorpay" source="keywords">RazorPay</keyword>, Stripe, PayU, Pine Labs, and more. Reportedly, these charges will be levied on small value transactions of up to Rs 2,000, which are made via <keyword id="22719132" type="General" weightage="20" keywordseo="debit-and-credit-cards" source="keywords">debit and credit cards</keyword>. Until now, all payment aggregators were exempt from GST on all transactions up to Rs 2,000. We decode what it means for you, and how it will impact your pockets. What's happening? The <keyword id="22666613" type="General" weightage="20" keywordseo="fitment-committee" source="keywords">fitment committee</keyword>, which is made up of revenue officials from both center and states, is considering levying an 18% GST on payment aggregators. This is because officials feel that PAs are mere facilitators and intermediaries for card-based transactions, unlike banks, and thus, should be brought under GST purview. At present, they are exempt on paying GST on transaction of value less than Rs 2,000. But, if the proposal goes through in the 54th <keyword id="19994390" type="General" weightage="100" keywordseo="GST-Council" source="keywords">GST Council</keyword> meeting, every transaction you make through your credit or debit cards going ahead via such PAs will become costlier. Who are payment aggregators? PAs are essentially third-party service providers that let customers pay, and allow businesses to collect payments made via UPI, credit/debit cards or more. They are the interface between the customers and the merchants, allowing customers to opt for multiple, secure payment options, and also letting merchants manage and track fund collections and refunds. For their services, PAs levy a payment gateway fee, which ranges between 0.5% to 2% for each transaction. Post demonetisation in 2016, when currency notes of Rs 500 and Rs 1,000 were discontinued with immediate effect, the government had waived off taxes on credit and debit card transactions of up to Rs 2,000, in order to boost digital payments. If GST is levied, PAs are likely to pass on this cost to merchants. Will UPI be affected? No. Currently, UPI does not currently have a MDR, or merchant discount rate. UPI will continue to remain a lucrative option for PAs and merchants, especially for transactions under Rs 2,000, since they will not attract GST. PAs charge MDR to businesses for processing credit and debit card transactions on their behalf. What will change? The move is likely to affect small businesses the most, who thrive on multiple, low value transactions. Think of this. Say you make a payment of Rs 1,500 via your credit card on Razorpay. If the PA sets its fee at 1% of each transaction, the business will have to pay Rs 15 to the PA. But now, with the potential additional 18% GST applicable, the business will have to pay Rs 2.7 more, or about Rs 17.7 to these PAs. This might not seem much at first, but compounded over multiple transactions, might snowball into a significant cost for small businesses.

GST Council mulling 18% GST on low value transactions made via RazorPay, PayPal and more. Here's how it will impact you

Online food delivery platform <keyword id="19901323" type="General" weightage="20" keywordseo="zomato" source="keywords">Zomato</keyword> on Thursday announced that its wholly-owned subsidiary <keyword id="20332565" type="General" weightage="20" keywordseo="zomato-payments-private-limited" source="keywords">Zomato Payments Private Limited</keyword> (<keyword id="20332941" type="General" weightage="20" keywordseo="zppl" source="keywords">ZPPL</keyword>) has been granted a certificate of authorisation from the <keyword id="19899810" type="General" weightage="20" keywordseo="reserve-bank-of-india" source="keywords">Reserve Bank of India</keyword> (<keyword id="19899808" type="General" weightage="20" keywordseo="rbi" source="keywords">RBI</keyword>) to operate as an '<keyword id="20332942" type="General" weightage="20" keywordseo="online-payment-aggregator" source="keywords">Online Payment Aggregator</keyword>'. The authorisation came into effect from January 24. "We wish to inform that ZPPL has been granted a certificate of authorisation dated January 24, 2024, from the RBI to operate as an 'Online Payment Aggregator' in India with effect from January 24, 2024, as per the guidelines issued by the RBI," Zomato said in an exchange filing. With this, Zomato Payments has expanded its role beyond food delivery and restaurant discovery into the realm of digital payments. Apart from this recent development, Zomato had partnered with ICICI Bank last year to introduce its own unified payments interface (<keyword id="19900911" type="General" weightage="20" keywordseo="upi" source="keywords">UPI</keyword>), Zomato UPI. Earlier this month, Zomato introduced a new feature called "daily payouts" to support emerging restaurant partners. Currently, the feature will be available for restaurant partners who receive 100 or fewer orders a month, according to the company. "Our discussions with various restaurant partners highlighted the financial challenges smaller eateries face, using the traditional weekly payout system. This feature is designed to address this critical need for more frequent access to earnings," Zomato said in a blogpost. SEE ALSO:<a href="https://www.businessinsider.in/tech/mobile/webstories/oneplus-12-vs-oneplus-12r-heres-whats-different-between-the-two-devices/slidelist/107138750.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/webstories/oneplus-12-vs-oneplus-12r-heres-whats-different-between-the-two-devices/slidelist/107138750.cms" target="_blank">OnePlus 12 vs OnePlus 12R – What distinguishes the two new smartphones</a><a href="https://www.businessinsider.in/business/auto/webstories/revolt-rv400-brz-an-electric-bike-for-the-city-with-150-km-range-hits-indian-roads/slidelist/107142891.cms" target="_blank"></a> <a href="https://www.businessinsider.in/business/auto/webstories/revolt-rv400-brz-an-electric-bike-for-the-city-with-150-km-range-hits-indian-roads/slidelist/107142891.cms" target="_blank">Revolt RV400 BRZ – An electric bike for the city with 150 km range hits Indian roads</a> <a href="https://www.businessinsider.in/business/auto/news/rolls-royce-spectre-rolls-out-as-indias-most-expensive-electric-car/articleshow/107051636.cms">Rolls Royce Spectre rolls out as India’s most expensive electric car</a>

Zomato gets RBI approval to operate as 'online payment aggregator'

<keyword id="7561347" type="General" weightage="100" keywordseo="enkash" source="Orion">EnKash</keyword> on Wednesday said it has received in-principle approval from the Reserve Bank of India to operate as a payment aggregator (PA). Founded in 2018, the spending management platform EnKash has helped thousands of businesses to digitize and decentralize their corporate payments. The licence by the central bank will enable the platform to broaden its product offerings to more number of businesses. Payment aggregators are intermediaries playing an important function in facilitating payments in the online space. According to <keyword id="30067" type="General" weightage="80" keywordseo="rbi" source="Orion">RBI</keyword>, these aggregators facilitate e-commerce sites and merchants to accept various payment instruments from the customers for the completion of their payment obligations without the need for merchants to create a separate payment integration system of their own. "We are excited to get in-principle approval from RBI for our payment aggregator license. This will help EnKash offer innovative products and solutions not only to our existing business ecosystem but also to bring about path-breaking and leading technological solutions to the market covering the entire payments flow," said <keyword id="8571523" type="General" weightage="50" keywordseo="yadvendra-tyagi" source="Orion">Yadvendra Tyagi</keyword>, Co-founder of EnKash. "This will help us streamline the cash flow process for businesses where they will be able to seamlessly consolidate their all payable and receivable and make necessary actions around payments," said <keyword id="19991" type="General" weightage="50" keywordseo="tyagi" source="Orion">Tyagi</keyword>, adding that the RBI's approval reiterates the need for digital solutions to manage business cash flows in an efficient way to sustain growth and profitability. EnKash now looks forward to bringing product offerings around corporate payments such as forex collections, cross-border payments, and Software-as-a-service collections. Notably, besides EnKash, several other firms have got RBI's in-principle nod to operate as payment aggregators. In 2020, the RBI issued guidelines saying firms it approves can only acquire and offer payment services to merchants. Existing non-bank entities offering payment aggregator services shall apply for such authorization. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/india/news/world-bank-sees-india-growth-slowing-to-6-6-next-fiscal/articleshow/96906506.cms">World Bank sees India growth slowing to 6.6% next fiscal</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/startups/news/live-ecommerce-startup-working-with-local-artisans-raises-6-million-in-seed-round-led-by-elevar-equity/articleshow/96909740.cms">Live ecommerce startup working with local artisans raises $6 million in seed round led by Elevar Equity</a>

EnKash gets RBI's in-principle nod to operate as payment aggregator

<keyword id="20341279" type="General" weightage="20" keywordseo="sbi-cards-and-payment-services-ltd" source="keywords">SBI Cards and Payment Services Ltd</keyword> has reported an 8 per cent rise in net profit to Rs 549 crore for the third quarter ended December 2023. The pure-play credit card company, promoted by <keyword id="19898108" type="General" weightage="20" keywordseo="sbi" source="keywords">SBI</keyword>, had posted a net profit of Rs 509 crore during the corresponding period of the previous financial year. Total income grew to Rs 4,742 crore during the October-December period from Rs 3,656 crore in the year-ago period, <keyword id="20190417" type="General" weightage="20" keywordseo="sbi-card" source="keywords">SBI Card</keyword> said in a regulatory filing. Total operating cost increased by 23 per cent at Rs 2,426 crore for the third quarter of FY24 from Rs 1,974 crore in the previous fiscal, it said. Gross non-performing assets (NPA) rose to 2.64 per cent during the quarter under review as against 2.22 per cent a year ago. Net NPA too increased to 0.96 per cent from 0.80 per cent at the end of the December quarter of the previous financial year. As a result, impairment losses and bad debt expenses grew to Rs 883 crore from Rs 533 crore in FY23. As of December 31, 2023, the card company's capital adequacy ratio was 18.4 per cent compared to 23.1 per cent as of March 31, 2023. As per the capital adequacy norms issued by the <keyword id="19899808" type="General" weightage="20" keywordseo="rbi" source="keywords">RBI</keyword>, the company's capital-to-risk ratio consisting of Tier I and Tier II capital should not be less than 15 per cent of its aggregate risk-weighted assets on the balance sheet and of the risk-adjusted value of off-balance sheet items. SEE ALSO:<a href="https://www.businessinsider.in/tech/mobile/webstories/oneplus-12-vs-oneplus-12r-heres-whats-different-between-the-two-devices/slidelist/107138750.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/webstories/oneplus-12-vs-oneplus-12r-heres-whats-different-between-the-two-devices/slidelist/107138750.cms" target="_blank">OnePlus 12 vs OnePlus 12R – What distinguishes the two new smartphones</a> <a href="https://www.businessinsider.in/business/auto/news/rolls-royce-spectre-rolls-out-as-indias-most-expensive-electric-car/articleshow/107051636.cms">Rolls Royce Spectre rolls out as India’s most expensive electric car</a> <a href="https://www.businessinsider.in/tech/news/global-pc-shipments-decline-for-the-eighth-straight-quarter-hopes-pinned-on-ai-to-drive-sales/articleshow/106981182.cms">Global PC shipments decline for the eighth straight quarter; hopes pinned on AI to drive sales</a>

SBI Card Q3 profit rises 8 pc to ₹549 crore

Digital payments and financial company <keyword id="6357120" type="General" weightage="20" keywordseo="paytm" source="Orion">Paytm</keyword> is looking to hive off its <keyword id="6640986" type="General" weightage="20" keywordseo="payment-aggregator" source="Orion">payment aggregator</keyword> business into a new subsidiary <keyword id="11994167" type="General" weightage="20" keywordseo="paytm-payments-services-limited" source="Orion">Paytm Payments Services Limited</keyword>, according to a notice sent to shareholders for approval. The company is seeking approval of the same from its shareholders through an extraordinary general meeting on September 23. "To consider and approve transfer of Payment Aggregator business to Paytm Payments Services Limited, a wholly owned subsidiary of the Company, to Paytm Payments Services Limited, a wholly owned subsidiary of the government to comply with <keyword id="6354335" type="General" weightage="20" keywordseo="reserve-bank-of-india" source="Orion">Reserve Bank of India</keyword> guidelines, being considered as sale of undertaking," the EGM notice issued on August 31 said. The new entity will include Paytm's online payment gateway business. RBI guidelines for regulation of payment aggregators (PAs) requires their business to be regulated and run by a separate company, after obtaining the licence from RBI. Indicative book value of the new entity is in the range of ₹275-350 crore which will be paid to the parent firm <keyword id="12005712" type="General" weightage="20" keywordseo="one9-communications" source="Orion">One9 Communications</keyword> (OCL) in five equal annual installments. The actual consideration will be the derived basis book value appearing as of August 31, 2021. OCL's Paytm provides digital and payment services to 33.3 crore consumers and over 2.1 crore merchants, as on March 31, 2021. The company has reported gross merchandise value of over ₹4 lakh crore for the financial year 2020-21. The company is likely to launch its ₹16,600 crore-IPO in October for which it has already filed draft papers with SEBI. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/startups/news/uber-has-ola-zomato-has-swiggy-but-whos-urban-company-competing-with/articleshow/85835674.cms">Uber has Ola, Zomato has Swiggy but who’s Urban Company competing with?</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/zerodha-gets-approval-to-enter-mutual-fund-business/articleshow/85855544.cms">Zerodha gets approval to enter mutual fund business</a>

IPO-bound Paytm transfers its payments business to new subsidiary

<ul><li>As mobile phones facilitate seamless payments, <keyword id="2970472" type="General" weightage="20" keywordseo="digital-transactions" source="Orion">digital transactions</keyword> by households are estimated to cross 50% by FY26, says a Redseer report. </li><li><keyword id="237977" type="General" weightage="20" keywordseo="online-shoppers" source="Orion">Online shoppers</keyword> are expected to grow by 50% in 3 years. </li><li>UPI as payment option is expected to almost double from 350-380 million. </li></ul>The Indian <keyword id="8191146" type="General" weightage="20" keywordseo="digital-payment-ecosystem" source="Orion">digital payment ecosystem</keyword> has been swelling in the last few years but by FY26, it will grow significantly, says a report by Redseer Consultants and Pine Labs. So much so that Indian households will do half of their payments digitally in three years. Currently, 35% of payments are done via digital modes. “Customers use digital payment methods in 80% of grocery, food delivery, and travel transactions. With mobile phones facilitating seamless <keyword id="7778421" type="General" weightage="20" keywordseo="p2m-payments" source="Orion">P2M payments</keyword>, digital transactions by households are estimated to cross around 50% by FY26,” the report said. Moreover, FY26 will be a landmark year when it comes to digital payment adoption as per the report. As of FY23, 400-450 million people performed online transactions which is expected to rise to 700-750 million. Added to that, unique mobile payment users who use UPI or wallets as a digital payment mode is expected to almost double from 350-380 million now to 650-700 million in three years. “UPI has gained widespread acceptance among the masses as the most popular digital payment method. PhonePe, Google Pay, Paytm, and Cred account for over 95% of the market share,” Redseer said. Buying online, paying digitally One of the biggest boosts to <keyword id="6358577" type="General" weightage="20" keywordseo="digital-payments" source="Orion">digital payments</keyword> comes from online retail — as the act of shopping itself is going online. Moreso, Bharat i.e. India that resides beyond big towns is also taking to online shopping, increasing adoption of digital payments. “Our research suggests that online shoppers in India are expected to grow by 50% in the coming three years to reach over 30 crore by FY26, further paving the way for the reach of online payments in the country,” said Jasbir Juneja, partner at Redseer, The other popular services that people pay online for are — food delivery and mobility which is represented by cab and bike aggregators. On the other end, businesses are taking to the trend too. Around 75% of the 70 million businesses are digitally enabled. This number is expected to rise to 85% by FY26.

Indian homes expected to make half their payments digitally in 3 years

New Delhi, Advocating DPI's potential in helping nations leapfrog digital transformation, a <keyword id="42981" type="General" weightage="20" keywordseo="G20" source="Orion">G20</keyword> document prepared by <keyword id="6354424" type="General" weightage="20" keywordseo="world-bank" source="Orion">World Bank</keyword> has praised India's approach in unlocking the power of digital public infrastructure, including Aadhaar and UPI, for financial inclusion. The impact of DPI goes beyond inclusive finance, to supporting health, education, and sustainability, says the foreward of the document 'G20 policy recommendations for advancing financial inclusion and productivity gains through DPI'. "The India stack exemplifies this approach, combining digital ID, interoperable payments, a digital credentials ledger, and account aggregation. In just six years, it has achieved a remarkable 80 per cent financial inclusion rate-a feat that would have taken nearly five decades without a DPI approach," it said. India's digital ID system Aadhaar, digital payment system UPI, data-exchange platform Digilocker and its other showcase platforms have found a special mention among the examples of DPIs "all of which play a leading role in the advancement of financial inclusion in many countries". Other systems mentioned were Singapore's Singpass, the Philippines' PhilSys, and the UAE's UAE-Pass among the digital ID systems; Brazil's Pix, India's UPI, Turkiye's FAST, the European Union's TIPS, and Thailand's PromptPay under fast payment systems; as well as Estonia's X-Road, Singapore's MyInfo, Australia's Customer Data Right, and the UK's Open Banking. Put simply, Digital Public Infrastructure (DPI) refers to blocks or platforms such as digital identification, payment infrastructure and data exchange solutions that help countries deliver essential services to their people, empowering citizens and improving lives by enabling digital inclusion. DPIs are interoperable, open, and inclusive systems supported by technology and provide essential, society-wide, public and private services that play a critical role in accelerating this digital transformation in an inclusive manner. The document also cites India's Data Empowerment and Protection Architecture (DEPA) and India's Account Aggregator (AA) Framework. On Fast Payment Systems, it noted that in some countries, such as India and Brazil the adoption has been "particularly quick and transformative". UPI, it said, has been widely adopted, benefitting from a user-friendly interface, open banking features, and private sector participation. "The UPI platform has gained significant popularity in India; more than 9.41 billion transactions valuing about Rs 14.89 trillion were transacted in May 2023 alone. For the fiscal year 2022-23, the total value of UPI transaction was nearly 50 per cent of India's nominal GDP," the report said. The document goes on to say that an aspect that makes DPIs unique, and that can further reduce existing constraints, is their ability to complement each other or be integrated in end-to-end workflows. One such service enabled by the interaction of open APIs and digital ID systems is the e-KYC or remote authentication services. A case in point is India's Aadhaar biometric identification system, which covers over one billion people and supports APIs, enables remote identification and authentication, it observes. Financial service providers can thus authenticate an individual's identity remotely, even by using selfie-based mechanisms to substitute for in-person customer due diligence verification requirements, it said. India has also figured prominently in the section on 'DPIs' Potential Added Value for the Private Sector', that cites how FSPs and MSMEs could benefit from these digital networks. "For some nonbank financial companies (NBFCs) in India, the AA ecosystem enabled an 8 per cent higher conversion rate in SME lending, a 65 per cent savings in depreciation costs, and a 66 per cent reduction in costs related to fraud detection. According to industry estimates, banks' costs of onboarding customers in India decreased from USD 23 to USD 0.1 with the use of DPI," it said. Through open application programming interface (APIs), India's Open Credit Enablement Network (OCEN) enables MSMEs participating in digital markets to secure credit by using information about their business history, rather than pledging physical assets as collateral. According to the document, in India, the implementation of various DPIs is considered to have played a critical role in the increase in account ownership from just one-fourth of adults in 2008 to almost 80 per cent a decade later "a journey that it is estimated would have taken up to 47 years without DPIs".

World Bank praises India's digital infrastructure for its transformative potential

<ul><li>During the FIFA World Cup final, the number of hourly food transactions increased to 1.7x the average. </li><li>Shah Rukh Khan-starrer Pathaan resulted in a significant 70% increase in multiplex transactions compared to the daily average. </li><li>Expenditures on flight tickets increased by 83%, while expenses on hotel accommodations almost doubled in value. </li></ul>It was the day of the FIFA World Cup final between Lionel Messi’s Argentina and France on December 18, 2022. The nail-biting match sent many nervous Indians scurrying to order food online. That day, between 8.30 PM IST to midnight, the number of hourly food transactions increased to 1.7 times the average — making it the fourth-busiest Sunday of FY23, according to a report released by Razorpay. The payment solutions provider Razorpay analysed over a billion transactions processed on its platform between April 1, 2022 and March 31, 2023 to find out how, when and what Indians spend on. The Khan-Kohli effect Matches, however, don’t always bring in the moolah. On October 23, 2022, Virat Kohli entered the Adelaide cricket ground and astounded the audience with his exceptional performance between 3.30 PM and 5.15 PM IST — a match that propelled India to the semi finals of the T20 World Cup. That day, as India held its breath, the total value of <keyword id="694150" type="General" weightage="20" keywordseo="online-payments" source="Orion">online payments</keyword> during the match fell by almost 40% as compared to the hours preceding the match. Alongwith cricket, cinema has always had the biggest influence on Indians. When Shah Rukh Khan’s much-awaited movie Pathaan was released, a large number of moviegoers left their OTT and other screens at home to get back to the silver screens. The movie grossed over ₹1,000 crore worldwide, helping multiplex transactions rise by a significant 70% as compared to the daily average. Says Rahul Kothari, chief business officer, Razorpay, "FY23 has been a year of hope, resilience, and rejuvenation for India, with a sharp growth in transactions across sectors as people rekindled old-forgotten joys of life. It also showed how Indians have embraced the digital age and how they are using new payment technologies to connect, collaborate, and transact.” Back to office, bad for broadband India's corporate sector was evidently spending more time outdoors, with co-working spaces experiencing a staggering 245% surge in transactions, and the number of payments made for cab services increasing sevenfold. However, the most significant change observed was that broadband expenditures decreased by nearly 80%. According to transactions processed on Razorpay's offline payments platform, Ezetap, spending on dining-out has increased by 2.5 times in FY23, and transaction volumes have surged 162% compared to the previous fiscal year. Offline shopping, online spending Indian consumers have returned to physical stores and have shopped extensively. According to transactions processed on Razorpay's offline payments platform, Ezetap, in-store payments have increased by 88% in value, and transactions have more than doubled in most major cities. Spending on apparel (127%), jewellery (88%), electronics (60%), and groceries (46%) have seen significant growth. The top five cities that experienced a steep increase in in-store payment volumes are Gurugram (160.93%), Pune (153.7%), Bengaluru (145%), Chennai (107.8%), and Kolkata (106%). The <keyword id="9771276" type="General" weightage="20" keywordseo="revenge-travel" source="Orion">revenge travel</keyword> trend also found its way to online transactions. Expenditures on flight tickets increased by 83%, while expenses on hotel accommodations almost doubled in value. Online travel aggregators witnessed a substantial 224% surge in transaction value.

Shah Rukh Khan, Messi, Kohli & how they influenced India’s online payment trends

<ul class="summary-list"><li>The economy bounced back strong after the pandemic, but is showing signs of slowing.</li><li>The resumption of student-loan payments is expected to add further strain.</li></ul>The US economy has thrived over the past three years, since the initial shock of COVID-19 gave way to a rapid recovery.One factor that <a target="_blank" href="https://www.businessinsider.com/cancel-student-loan-debt-payments-paused-two-years-economy-2022-1">helped lead the rebound</a> was the student-loan-payment pause enacted by the US government, which afforded borrowers more money to put back into the economy.The payment pause was "very stimulative," Marshall Steinbaum — senior fellow at the Jain Family Institute and economics professor at the University of Utah — <a target="_blank" href="https://www.businessinsider.com/what-will-happen-to-economy-when-student-loan-payments-resume-2023-5">previously told Insider</a>, citing the positive impact on aggregate demand.But with those payments set to restart, an already-weakening economic picture will face another headwind. That money will now instead go straight to the Education Department and loan servicers.The timing isn't great, considering the deteriorating economic picture. Signs have been piling up that the Federal Reserve's unprecedented interest-rate hikes are starting to <a target="_blank" href="https://www.businessinsider.com/recession-outlook-economy-consumer-spending-down-breaking-2023-9">bite everyday Americans</a>. Even a <a target="_blank" href="https://www.businessinsider.com/jobs-unemployment-rate-labor-market-september-report-2023-10">still-red-hot labor market</a> can be painted as a negative, since it fuels the argument that the Fed should leave rates higher for longer. All of this has <a target="_blank" href="https://www.businessinsider.com/recession-outlook-were-not-in-the-clear-yet-soft-landing-2023-10">recession calls flaring anew</a>.Fed Chair Jerome Powell noted himself that the resumption — accompanied by the <a target="_blank" href="https://www.businessinsider.com/uaw-strike-support-union-bipartisan-2023-10">United Auto Workers strike</a> and high oil prices — could complicate economic recovery for the rest of the year.Now, borrowers, the Education Department, and the overall economy are <a target="_blank" href="https://www.businessinsider.com/author/ayelet-sheffey">entering uncharted territory</a>. Millions of Americans have never resumed repayment at this scale after years of relief.Here's what banks and economists are saying about the impact of the student-loan payment resumption on the economy.<h2>What will happen to the economy with the student-loan payment restart</h2>It's difficult to predict how exactly the economy will respond to a surge of borrowers facing student-loan payments again — and it depends on a number of factors. For example, Wells Fargo <a target="_blank" href="https://wellsfargo.bluematrix.com/links2/html/35097f78-6327-4c0c-8164-246f54b0aad2">said</a> in a note this week it anticipates the resumption will be "a relatively contained headwind" because those who hold large balances — over $100,000 — are a small proportion of the total number of borrowers and would not have a significant macroeconomic impact.However, the impact of the resumption could be spread over a longer period depending on how many borrowers <a target="_blank" href="https://www.businessinsider.com/what-is-the-best-way-to-pay-student-loan-debt-2023-10">make use of measures to ease repayment</a>, like the 12-month "on-ramp" period during which missed payments will not be reported to credit agencies."Even with a relatively contained direct macro impact, repayment is coming at a time when households' staying power is dwindling, and will likely contribute to a slowdown in spending later this year and into early 2024," the note said.Goldman Sachs had a <a target="_blank" href="https://www.gspublishing.com/content/research/en/reports/2023/09/12/c4a88156-6948-4847-b703-84a8293159c0.html">similar prediction</a> — it said last month it expects the resumption to "temporarily slow growth" in the fourth quarter of this year, but it depends on the scale of borrowers who choose not to resume payments right away, along with those who enroll in the new SAVE income-driven repayment plan.The <a target="_blank" href="https://www.businessinsider.com/economic-impact-supreme-court-student-loan-forgiveness-ruling-what-means-2023-6">retail sector is also preparing for a strain</a>. In an August earnings call, Macy's CEO Jeff Gennette <a target="_blank" href="https://www.cnbc.com/2023/10/01/how-the-restart-of-student-loan-payments-could-shake-the-economy.html">said</a> he anticipates the student-loan payment resumption to bring some headwinds, and Target CFO Michael Fiddelke said during the company's most recent earnings call that "the upcoming resumption of student loan repayments will put additional pressure on the already strained budgets of tens of millions of households."<h2>What will happen to borrowers</h2>With regards to the impact on borrowers individually, a June note from Bank of America said <a target="_blank" href="https://www.businessinsider.com/what-will-happen-when-student-loan-payments-resume-sizeable-shock-2023-6">the resumption would likely bring "a sizeable shock,"</a> with delinquencies expected to rise in the coming weeks.And a recent <a target="_blank" href="https://finance.yahoo.com/news/nike-and-other-retail-stocks-downgraded-as-jefferies-warns-of-spending-slowdown-162358613.html">survey</a> from Jefferies of 600 US consumers with student debt found that nearly 90% of them said they were "somewhat concerned" about meeting their monthly expenses, with half of the respondents saying they were "very concerned."The administration has acknowledged the financial strain the resumption will have on borrowers, and their need to reconfigure their monthly budgets to meet the extra expense."There's a lot of anxiety out there," Under Secretary of Education James Kvaal <a target="_blank" href="https://www.businessinsider.com/borrowers-repaying-student-loan-debt-before-payments-resume-2023-9">said in September</a>. "And some borrowers have already begun making payments. In other cases, there will be borrowers who will take some time to work student loans back into their household budgets."Some borrowers are already feeling the strain. Helena, a 58-year-old borrower, <a target="_blank" href="https://www.businessinsider.com/how-to-afford-student-loan-payments-borrowers-sells-ebay-debt-2023-9">previously told Insider</a> that she's unable to afford her $145,000 balance and isn't sure what she'll do once her first bill becomes due."It's my faith. That's the thing that's sustained me," she said. "Because otherwise, if I look at the debt, it makes me feel tremendously hopeless."

The student-loan payment restart is about to put pressure on an already-fragile economy

<ul><li>This could be a huge opportunity for companies and payments startups providing access to <keyword id="6367143" type="UNKNOWN" weightage="20" keywordseo="LIC">LIC</keyword>'s over 250 million customers.</li><li>Business Insider has learnt that, on February 5, 2021, LIC floated the “request for proposal (RFP)” for a contract which will be valid for five years.</li><li>Check out the latest news and updates on <a href="https://www.businessinsider.in/">Business Insider.</a></li></ul>The <keyword id="6365973" type="ORGANIZATION" weightage="20" keywordseo="life-insurance-corporation">Life Insurance Corporation</keyword> of India (LIC), the country’s largest and over half a century old insurer, has a golden egg for India’s payment gateway operators. LIC is currently inviting bids from payment aggregator companies to enable digital payment of premiums for its over 250 million customers – an opportunity for the likes of <keyword id="2777173" type="PERSON" weightage="20" keywordseo="Razorpay">Razorpay</keyword>, Paytm, PayU to pounce upon and gain LIC’s millions of users overnight. <div type="image" title="LIC" msid="81304415" hostid="261"></div> Business Insider has learnt that, on February 5, 2021, LIC floated the “request for proposal (RFP)” for a contract which will be valid for five years. The RFP, seen by Business Insider, states that “LIC wishes to avail a comprehensive, fully automated end to end solution for all types of collections of LIC, not limited to just premiums, by integrating LIC’s website with an integrated Internet Payment Aggregator”. <div type="Youtube" id="Vvc-BuPvE3k" title="India&amp;#39;s largest insurer LIC is inviting bids from payment aggregators⁠" thumbUrl="https://i.ytimg.com/vi/Vvc-BuPvE3k/mqdefault.jpg"></div> LIC had earlier floated a similar bid in 2017, but the bid had not seen the light of the day. But now, there are big things lined up for LIC. The 65-year old insurer is headed for a market debut too this year, as announced by Finance Minister Nirmala Sitharaman in her Budget 2020 speech. One of India’s payment gateway operators Razorpay has confirmed to Business Insider that it has been invited to bid for LIC, and will be submitting its proposal in March. However, the billion dollar startup did not share any further details. For LIC, a tryst with ‘using data’ For technology enthusiasts like Rajeev Suri, the managing director at Orios Venture Partners, the bigger benefit lies for LIC in this partnership. Suri takes a leaf out of China’s playbook to cite the example of Alipay and its success. Alipay, the payments app from Jack Ma’s Ant Financial, used data from the payments vertical to<a href="https://hbr.org/2020/09/why-hasnt-apple-pay-replicated-alipays-success#:~:text=Alipay%2C%20which%20was%20spun%20off,behind%20it%20went%20beyond%20payments."> sell more products to users</a>, which eventually led to Ant Financial becoming a mammoth financial company with a valuation of over $300 billion. The data that these payment aggregators have, would give LIC the opportunity to direct policies to the right user, making way for a deeper penetration of <keyword id="35450" type="COMPANY" weightage="20" keywordseo="insurance">insurance</keyword> in India. And it is this disruption of data that is driving the story for LIC. “Today, insurance is mainly used as a tax saving alternative. But with data from these startups will help LIC. That is the data driven magic that happened in China that built the most powerful IPO the world has ever seen. And it could happen with LIC too,” said Suri. For any payment gateway operator, an opportunity of a lifetime According to a Goldman Sachs report, the online individual insurance market (life and health) could be worth $1.25bn by FY25, more than tripling from $365mn in FY20. And without a doubt, LIC holds the mammoth share of the market. <div type="image" title="LIC" msid="81304426" hostid="261"></div> For India’s payment startups, this will be a big chance to gain more users and transactions. In 2019-20 alone, LIC processed premiums worth ₹3.79 lakh crore ($51.7 billion). And this, while India continues to remain a poorly insured country with barely 4% market penetration, leaving a wide opportunity for LIC to grow further. India’s digital payment market is projected to grow to be worth $300 billion by FY25, according to a report by Bank of America from January 2021. And at the heart of it are homegrown players like Paytm, Razorpay who will be riding the wave of <keyword id="6358577" type="UNKNOWN" weightage="20" keywordseo="digital-payments">digital payments</keyword>. Insurance in India is still heavily regulated and for any startup, working with LIC would mean clearing many hurdles at once. “LIC is the grandmaster of insurance in India. For any startup partnering with LIC would mean an easier sell of insurance to consumers, the trust deficit associated with financial products would go away when there is an association with LIC,” Suri told Business Insider. For startups, which are still heavily concentrated in India’s bigger cities, working with LIC will open up direct access to users across Tier 2, 3 cities. Suri believes that the startups would become a ‘trustworthy’ company across India as the recognition value of LIC is high. So who can bid for the LIC tender? Partnering with India’s biggest life insurer, which is also headed for the public markets in what is called as the ‘biggest IPO of the decade’, won’t be an easy task. LIC in its RFP has already issued an eligibility criteria with multiple factors that each amount to a set number of points. The points will be decided on factors such as the total value of digital transactions done by the company in 2019-20, with over ₹50 crore taking the highest points, number of years of experience in the industry, among others. For a company to win the bid, it will need a minimum of 75 points. But that’s not the only hiccup. To bid for LIC means the company would have to first give an Earnest Money Deposit OF ₹10 lakh and the final winner would have to submit a Performance Bank Guarantee (PBG) of ₹10 crore. And all of this makes it a little complicated. "Technically, because of bidding these end up being low revenue opportunities," a source at one of the top payment aggregators told Business Insider on the condition of anonymity. Interestingly, there are many more players entering the payments industry with full force. From Mukesh Ambani’s Reliance to the Jeff Bezos-led Amazon have partnered with banks and other organisations, to apply for a <a href="https://www.businessinsider.in/finance/news/explained-the-nue-licence-for-payments-that-tata-ambani-and-bezos-have-applied-for/articleshow/81268434.cms">new umbrella entity (NUE) licence</a>, which will have powers similar to the apex body National Payments Corporation of India (NPCI). SEE ALSO: <a href="https://www.businessinsider.in/finance/news/explained-the-nue-licence-for-payments-that-tata-ambani-and-bezos-have-applied-for/articleshow/81268434.cms">EXPLAINED: The NUE licence for payments that Tata, Ambani and Bezos have applied for</a> <a href="https://www.businessinsider.in/thelife/personalities/news/meet-jay-chaudhry-the-man-who-studied-under-a-tree-in-himachal-to-become-one-of-the-worlds-top-billionaires-today/articleshow/81288884.cms">Meet Jay Chaudhry, the man who studied under a tree in Himachal to become one of the world’s top billionaires today</a> <a href="https://www.businessinsider.in/business/news/elon-musk-and-reliance-industries-mukesh-ambani-compete-in-energy-storage-skytran-and-hyperloop/articleshow/81266903.cms">Elon Musk is facing a challenge from Asia’s richest man Mukesh Ambani in India⁠— both in energy and transportation</a>

EXCLUSIVE: Ahead of the LIC IPO, a large tender from India's largest insurer is inviting bids from payment aggregators

<keyword id="6357120" type="General" weightage="20" keywordseo="paytm" source="Orion">Paytm</keyword> grew their revenues by 42% YOY in the third quarter of FY23 to ₹2,062 crore. The growth was driven by an increase in merchant subscription revenues, growth in loan distribution, and momentum in the commerce business. Given the timing of the accrual of the UPI incentive, there was no UPI incentive recorded in this quarter. Paytm’s focus on subscription services to create additional payment monetization continues to expand with the number of merchants paying subscriptions for payment devices like Paytm Soundbox and POS reaching 6.1 million at the end of January, an increase of 0.3 million in the month. The number of merchants paying subscriptions increased by one million in Q3 FY23. With their subscription-as-a-service model, the strong adoption of devices drives subscription revenues and higher payment volumes, while increasing the funnel for their merchant loan distribution. Paytm is seeing sustained traction in subscriptions and earning more than ₹100 per month per device. Further, Paytm has received additional incentives on select installations from partner banks, RBI and NABARD etc. Paytm’s founder and CEO Vijay Shekhar Sharma during the recent earnings call said that Paytm’s focus with merchants is not limited to just devices but includes various other subscription line items. The total merchant GMV processed through Paytm’s platform in Q3 FY 2023 aggregated to ₹3.5 lakh crore, marking a YoY growth of 38%. <keyword id="7656598" type="General" weightage="20" keywordseo="merchant-payments" source="Orion">Merchant payments</keyword> volume in the month of January was ₹1.2 lakh crore, growing 44% from a year ago. Paytm’s focus over the past few quarters continues to be on payment volumes that generate profitability for Paytm, either through net payments margin or from direct upsell potential. During the earnings call, founder and CEO Vijay Shekhar Sharma said that Paytm’s focus on merchant payments has created a scalable UPI revenue model in subscription. “I feel highly positive and inspired by the adoption of our device business, especially Soundbox which has led to significant scale in UPI acquiring,” he said. UPI has emerged as one of the key low CAC customers and merchant acquisition channels for us. Paytm’s registered merchant base expanded to 31.4 million at the end of December 2022. Their CEO Vijay Shekhar Sharma also mentioned that Paytm’s revenue from merchant business in the payments industry is particularly higher than every other peer company. “Somebody chose P2P, somebody chose P2M, we chose merchant business. Our acquiring side market share, which NPCI does not yet declare, once they start declaring, you will see how well Paytm is capitalized there over other UPI players, also standalone UPI players or other payment aggregators,” he added. As per the notification received from the Government of India on January 11, 2023, Paytm estimates that for Q1-Q3 FY 2023, it will receive ₹130 crore of UPI incentives in Q4 FY 2023. Paytm leverages their two-sided ecosystem of consumers and merchants and rich insights from their platform to cross-sell high-margin financial services and merchant services. Paytm enables their merchants with tech solutions that allow them to accept payments through a wide variety of instruments and by deploying subscription-based devices that help with reconciliations. Paytm also enables commerce and allows them to advertise, sell gift vouchers, deals and tickets. For consumers and merchants, Paytm offers various lending products such as Paytm Postpaid (BNPL), personal loans and merchant loans, with their financial institution partners. Paytm’s lending business continues to scale providing attractive upsell revenues. Their portfolio qualities have been demonstrated over multiple payment cycles. Paytm believes that upselling lending products is a scalable opportunity and sees a large profit pool in their loan distribution business. The penetration for merchant loans is 5.2% of device merchants. Paytm believes there is a long runway for growth as their payments consumer and merchant base offers a large addressable market for loan distribution. Disclaimer : This article has been reproduced from Paytm's blog. The opinions expressed are those of the organization and do not necessarily reflect the views of Business Insider India. For further details, you can get in touch with our team on insiderstudios@businessinsider.in

Here’s how Paytm built a scalable, revenue-generating UPI model with focus on merchant payments

<ul><li>Paytm's stocks saw a sharp downside movement after a block deal that took place where 259,930 shares were sold.</li><li>Sources have confirmed that Chinese group Alibaba is behind the block deal.</li><li>According to sources, Alibaba seems to be making an exit from India as it had sold shares in other investments as well </li></ul> Paytm's stocks on Thursday saw a sharp downside movement after a block deal that took place where 259,930 shares were sold. The shares were sold at Rs 535.90 worth Rs 13.93 crore. Sources have confirmed that Chinese group Alibaba is behind the block deal, thereby selling about 3.1 per cent of its total equity of about 6 per cent. With this block deal, Alibaba, the sources said, seems to be making an exit from India as it had sold shares in other investments such as BigBasket and Zomato. This is expected to bring cheers among investors. With Chinese shareholding reducing their stake, it will benefit the company in their Foreign Direct Investment (FDI) aspect. Paytm shares' intraday low was Rs 528.10. In fact, immediately after the block deal it soon recovered some part of the losses. Paytm's shares had been steadily rising for the past few days after there were several good news floating about the company. Its associate <keyword id="3236791" type="General" weightage="80" keywordseo="paytm-payments-bank" source="Orion">Paytm Payments Bank</keyword> has received <keyword id="30067" type="General" weightage="80" keywordseo="rbi" source="Orion">RBI</keyword> approval to appoint <keyword id="5719896" type="General" weightage="80" keywordseo="surinder-chawla" source="Orion">Surinder Chawla</keyword> as its Managing Director and CEO. The company had posted a strong operating performance update for the October-December quarter. The Paytm Super App continued to see growing consumer engagement with the average Monthly Transacting User for the quarter that ended December 2022 at 85 million, registering a growth of 32 per cent on a yearly basis. The total merchant <keyword id="2185962" type="General" weightage="80" keywordseo="gross-merchandise-value" source="Orion">Gross Merchandise Value</keyword> processed through the platform for the quarter ended December 2022 aggregated to Rs 3.46 lakh crore (USD 42 billion), marking a year-on-year growth of 38 per cent. The number of loans grew 117 per cent yearly to 3.7 million for the month of December, and 137 per cent to 10.5 million cumulative loans for the three months ended December 2022. As a result, total disbursements for the three months ended December 2022 was Rs 9,958 crore, a growth of 357 per cent on year. Paytm believes it continues to be on track for its profitability plans, with robust revenue growth driven by its strong business model. Meanwhile, brokerage and global investment firm <keyword id="48670" type="General" weightage="80" keywordseo="morgan-stanley" source="Orion">Morgan Stanley</keyword>, in a report, pegged Paytm's shares target price to be at Rs 695 going ahead as against Rs 579 at Wednesday's close. It essentially means there is an upside potential of about 20 per cent returns on investment for investors. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/paytm-will-be-key-beneficiary-of-indias-upi-incentive-scheme-morgan-stanley/articleshow/96933995.cms">Paytm will be key beneficiary of India's UPI incentive scheme: Morgan Stanley</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/tcs-revenue-growth-to-slowdown-in-fy24-fitch-ratings/articleshow/96933754.cms">TCS revenue growth to slowdown in FY24: Fitch Ratings</a>

You Searched For "payment aggregators" and got 13 results

Paytm shares jump 5% on receiving government's nod for investment in Paytm Payments Services

PTI

GST Council mulling 18% GST on low value transactions made via RazorPay, PayPal and more. Here's how it will impact you

Ira Alok Puranik

Zomato gets RBI approval to operate as 'online payment aggregator'

IANS

EnKash gets RBI's in-principle nod to operate as payment aggregator

ANI

SBI Card Q3 profit rises 8 pc to ₹549 crore

PTI

IPO-bound Paytm transfers its payments business to new subsidiary

PTI

Indian homes expected to make half their payments digitally in 3 years

Katya Naidu

World Bank praises India's digital infrastructure for its transformative potential

PTI

Shah Rukh Khan, Messi, Kohli & how they influenced India’s online payment trends

Anagh Pal

The student-loan payment restart is about to put pressure on an already-fragile economy

Ayelet Sheffey

EXCLUSIVE: Ahead of the LIC IPO, a large tender from India's largest insurer is inviting bids from payment aggregators

Sanchita Dash

Here’s how Paytm built a scalable, revenue-generating UPI model with focus on merchant payments

Insider Studios

Alibaba exiting India? Paytm among other Alibaba-owned stocks seeing selloff

ANI

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