Paytm plans to expand its operations into Saudi Arabia, the UAE, and Singapore, joining other fintech companies in these markets. The company has also increased default loss guarantees for its lending operations and appointed Bimal Julka as a non-executive independent director on its board.
Paytm, a leading Indian fintech startup, is set to expand its operations into the Middle East and Southeast Asia, specifically targeting markets in Saudi Arabia, the UAE, and Singapore. This move follows a trend in which other fintech companies, such as M2P Fintech, are already providing banking services in these regions, while CCAvenue and Pine Labs have initiated payment businesses.
In an effort to strengthen its lending services, Paytm has enhanced the default loss guarantees provided to its non-banking finance partner, SMFG India Credit Company. The guarantees have increased significantly from Rs 225 crore to Rs 350 crore, aligning with the guidelines set by the Reserve Bank of India, which permits fintechs to offer default guarantees up to 5% of loans disbursed through their partners.
Additionally, Paytm announced the appointment of Bimal Julka, a former bureaucrat and secretary to the information and broadcasting ministry, as a non-executive independent director on its board. Alongside him is Ravi Chandra Adusumalli, another non-executive independent director representing Elevation Capital, one of Paytm’s early investors.
This strategic expansion and governance strengthening signal Paytm’s commitment to growth in international markets and enhanced financial services in India.
The fintech sector in India has seen a surge in companies looking to broaden their horizons, particularly in rapidly growing markets like the Middle East and Southeast Asia. The expansion into Saudi Arabia, the UAE, and Singapore reflects the recognition of these markets’ potential, where digital banking and payments are on the rise. Companies such as M2P Fintech are leading the charge, while established businesses like Paytm seek to bolster their lending capabilities through strategic partnerships and enhanced financial guarantees. Furthermore, the restructuring of Paytm’s board by including experienced individuals like Bimal Julka illustrates a dedication to corporate governance aligned with their expansion objectives. Such moves not only signify an emphasis on compliance and strategic insight but also aim to attract investor confidence and navigate complex regulatory landscapes.
In conclusion, Paytm’s expansion into Saudi Arabia, the UAE, and Singapore marks an important phase of growth for the company and positions it favorably amidst emerging fintech landscapes. The increases in default loss guarantees highlight its commitment to strengthening lending operations in cooperation with financial partners. Additionally, the appointment of experienced directors enhances governance, which can be expected to boost trust among investors and foster further growth.
Original Source: economictimes.indiatimes.com
