After more than a year's delay, online mobile wallet major Paytm would finally launch its payments bank on May 23. But in a crucial change, former Reserve Bank of India (RBI) executive and PricewaterhouseCoopers consultant Shinjini Kumar, who was chosen for the role of the payments bank chief executive officer (CEO), has stepped down and is in exit mode, while Renu Satti, vice-president, business, will take over. (A payments bank can carry out most banking operations but can't give out loans or issue credit cards.)
"We are in the process of launching Paytm Payments Bank on May 23. We recently received approval from RBI for Renu Satti to be the CEO," said a Paytm spokesperson.
Kumar told Business Standard that she stepped down as she was relocating back to Mumbai. Paytm Payments Bank headquarters would be in Noida. "I want to be in Mumbai. I tried to relocate to Delhi, but as things are evolving more, it was difficult to travel back and forth between Delhi and Mumbai. That is the reason I decided to step down," Kumar said.
She added that sending a fresh list of probable CEOs for the payments bank for approval, as well as some other conversations with RBI, caused a delay in final approval.
Satti started as manager, human resources, Paytm, nearly a decade back and has risen up the corporate ladder since. She has headed different teams for online marketplace and mobile wallet at the firm.
The payments bank will launch its services first in Uttar Pradesh (UP) and then expand to northeast.
In January, Paytm founder and CEO Vijay Shekhar Sharma told Business Standard that in the first phase the payments bank would have 100,000 banking correspondents. "In the first phase, we are targeting as many as 200 million wallets, current accounts and savings accounts. While normal banks target savings accounts and current accounts, we will target wallets as well," he had said.
In the last one and a half years, Paytm postponed the opening of the payments bank seven times. Sharma in January had even announced the launch of the bank. But it got delayed.
The payments bank would start its operations with Rs 400-crore initial capital and the first branch would be set up in Noida, UP. The first branch in northeast would open in Guwahati. Last year, during demonetisation, Sharma was in Hong Kong for a stake sale for setting up the payments bank. "When demonetisation happened, I had not got my money to spend on payments bank, which means during initial five days I was a fish out of water and I had to sell my shares to complete the process, as the bank approval was pending. Around Rs 220 crore has been put into the bank, of which Rs 120 crore has come from my side," Sharma had told Business Standard.
Eleven applicants received payments bank licences from RBI. After the initial euphoria, three recipients withdrew their applications. However, Paytm hopes to make payments bank one of the biggest businesses in its portfolio and the second-largest revenue earner after wallets.
Airtel Payments Bank Limited was the first payments bank in India to go live.