Paytm plans to expand operations to Saudi Arabia, UAE, and Singapore amidst a trend of Indian fintech startups entering these markets. The company has also increased its default loss guarantees for SMFG India Credit Company. Former bureaucrat Bimal Julka has been appointed to the board as a non-executive independent director, joining Ravi Chandra Adusumalli.
Paytm is set to expand its operations into Saudi Arabia, the UAE, and Singapore, joining several other Indian fintech companies venturing into these markets. Competitors such as M2P Fintech are currently facilitating banking services, while CCAvenue and Pine Labs have rolled out payment solutions. To strengthen its lending capabilities, Paytm has increased default loss guarantees for its non-banking finance partner, SMFG India Credit Company, raising them from Rs 225 crore to Rs 350 crore.
The Reserve Bank of India permits fintech firms to offer default guarantees amounting to 5% of the loans issued through their partners, which supports their risk management strategies as they expand. In a strategic move, Paytm has also appointed Bimal Julka, a former bureaucrat who served as the secretary of the Information and Broadcasting Ministry, as a non-executive independent director on its board. Additionally, Ravi Chandra Adusumalli represents Elevation Capital, one of Paytm’s earliest investors, as another non-executive independent director on the board.
The fintech industry in India is witnessing a significant push towards international expansion, particularly in the Middle East and Southeast Asia. Regions like Saudi Arabia, the UAE, and Singapore are becoming increasingly attractive due to their growing digital economies and financial services sectors. Companies like Paytm are strategically enhancing their product offerings, particularly in lending and payment solutions, to compete with other established fintech players in these markets.
In summary, Paytm is embarking on an ambitious expansion into key markets in the Middle East and Southeast Asia as it seeks to enhance its lending operations and broaden its services. The appointment of experienced individuals to its board is a strategic move aimed at strengthening corporate governance and leveraging industry expertise. Continued growth for Paytm in these new markets will depend on effective management of its enhanced lending guarantees and adaptation to local regulatory environments.
Original Source: economictimes.indiatimes.com
