While Paytm Payments Bank cannot process loans on its own balance sheet, it can work with banks and non-bank lenders under the co-origination model. Paytm also offers co-branded credit cards along with SBI Cards & Payment Services Ltd. The card has no minimum income criteria and can be offered to salaried as well as self-employed individuals, who use the Paytm application.
Among its key lending products, Paytm Postpaid is a buy-now-pay-later scheme for consumer purchases, through tie-ups with banks and non-bank lenders. Users can use their mobile wallets to access the product and make their purchases, with repayments structured in installments through the wallet.
Paytm Postpaid provides credit limits ranging from Rs 20,000 to Rs 1 lakh. Since it was launched in 2020, the product saw quick adoption, said Bernstein without citing any data.
It also provides credit facilities to merchants. This, too, is done through the partnership model, where Paytm earns a fee for sourcing and servicing the loan for the lenders it partners with.
Apart from these, Paytm offers small value, short tenure personal loans through tie-ups with partners such as Hero Fincorp, Aditya Birla Finance, Clix Capital and Tata Capital. Paytm helps process the credit by assessing the mobile wallet activity of its users.