Paytm, which opened a payments bank last month, is now looking to disrupt
the financial sector as it has applied for a licence to set up a money-market
mutual fund (an open-ended mutual fund) that invests in treasury bills and
commercial papers for a short term.
This would increase its offering to its customers, who can park their
surplus cash and earn interest. Earlier in the year, it started digital trading
in gold.
As per the RBI norm, payments banks can accept deposit up to Rs 1 lakh
from a customer but it can’t lend money. They can issue ATM/debit card and
distribute financial products like mutual fund and insurance. Paytm had
received the payments bank licence in 2015.
Paytm founder Vijay Shekhar Sharma holds 51 percent stake in the Paytm
Payments Bank and wants to replicate the business model of Alibaba which has
set up Yu’E Bao Fund that has become the world's largest money market fund.
Their
customer base increased rapidly after the note ban which was enforced in
November last year and has touched over 250 million users.
More will update soon!!
