13 February 2024 – Axis Bank, a leading private sector lender, expresses openness to collaborating with Paytm, subject to regulatory approval from the Reserve Bank of India (RBI). Managing Director and CEO Amitabh Chaudhry conveyed the bank’s interest during the Axis Bank’s `2023 Burgundy Private Hurun India 500′ launch event.
Background:
Axis Bank, a major player in the merchant acquiring space, is engaged in discussions with Paytm for potential partnerships across various business lines. The talks follow RBI’s recent actions against Paytm Payments Bank, creating an opportunity for renewed collaboration between the two entities.
Chaudhry emphasized that any collaboration with Paytm would be contingent on regulatory approval from the RBI. Paytm, facing restrictions on most activities post-Feb 29, may need to partner with a bank, replacing Paytm Payments Bank, to continue operating as a UPI app.
Scope of Collaboration:
Axis Bank, having diversified its presence in the payments sector through acquisitions like Citibank’s card business and Freecharge, is exploring partnerships with Paytm across different business aspects. Discussions include potential collaboration in Fastag, transit card services, and wallet offerings.
Arjun Chowdhry, Group Executive for Affluent Banking, NRI, Cards, and Payments at Axis Bank, highlighted the bank’s continued focus on merchant acquisition. Merchant payments on UPI have reportedly surpassed credit card transactions, attracting interest from various stakeholders.
Axis Bank intends to replace Citibank-branded cards with Axis Bank cards in the first half of FY25. The bank aims for a seamless transition to ensure no disruption for cardholders, retaining their numbers and standing instructions.
Conclusion:
The ongoing discussions between Axis Bank and Paytm signify potential collaboration in the evolving landscape of India’s financial services. The outcome, contingent on regulatory approvals, could shape new avenues for both entities, reinforcing the dynamic nature of partnerships in the financial technology sector.
