Paytm all set to enter into mutual fund industry.
India’s largest digital wallet firm Paytm is all set to enter India’s trillion dollar mutual fund market by launching a new digital platform by end of this month. This digital platform is actually a smartphone application, which will be available for both Android as well as IOS users, according to people familiar with the matter.
Paytm’s mobile app will initially offer mutual funds from 15 largest asset management companies. Later, the Gurgaon based startup aims to increase this number to almost 25 mutual fund companies. The entire mutual fund and wealth management business will be looked over by Paytm Money, a new independent unit of On97 Commination, which is the parent company of Paytm.
Experts cheer Paytm’s maiden entry into mutual fund market
Although it is too early to predict about Paytm’s latest bet but most industry experts feel that this bet might work quite favorably for India’s largest digital wallet startup. In fact, some experts claim that Paytm may have the same disruptive impact on the mutual fund market as Jio’e entry had on the telecom sector.
This prediction doesn’t appear to be far-fetched one, considering the fact that Paytm boosts customer base of whopping 300 million, which is almost 16-18 bigger than the customer base boasted by most mutual fund companies.
However, Paytm poses huge hurdle as most of its transactions come from small town regions, where investing in mutual funds is still not seen as a viable investment option. But the company is hopeful of crossing this hurdle by directly selling mutual funds to its customers, which would spare them from paying distribution commission.
Last year, Paytm was one of the few companies to secure payment bank license, which paved the company’s entry into the banking sector. Now with eyes firmly set on mutual fund markets, Paytm is certainly to grow its business beyond its core digital wallet business.