Introduction

Founded 9 years ago in 2010 in Noida, PayTM (paytm.com) has become India's largest
leading payment gateway. It offers comprehensive payment services for both customers
and merchants and has introduced many new offerings in these years like Paytm Mall,
Paytm Payments Bank, Paytm Wallet, UPI services and more. It is available on most internet
platforms including Android, mobile web application, desktop and tablet.
It was founded by Vijay Shekhar Sharma, who is also the current CEO. It is currently held by
Alibaba Group (42%), One97 Communications Ltd (38%), Softbank (20%). It had 350 Million
users of its services as of 2019.
Business Model Canvas

Value Proposition
PayTM started with the recharging business which was its major proposition initially. They
were trying to solve the problem of under-banking and difficulty in recharging by providing
easy to use platform. The smooth and simple GUI gave them a competitive advantage over
other websites.
Their tagline “simple & incredible!” states that too.
The second part of the value proposition was to turn the recharging business into a parallel
banking system. In 2010, there was a huge underlying potential of such system as almost
65% of Indians didn’t have access to banks and there weren’t good alternatives available.
They made it easy for people to move money between their friends, families, customers and
suppliers through mobile. This came with a huge network effect. Paytm became far more
valuable to its users as more people started using it. Then, it went on to diversify and
advance to producing newer services from the likes of Paytm Wallet, E-commerce vertical to
Digital Gold.
Over the last two years, after Alibaba’s investment, the focus has shifted from being an
online payment services provider towards creating a closed ecosystem by bringing vendors
on their site. This is like the evolution of WeChat from a messaging system to an integrated
marketplace. This is a defensive move as economies of scale is considered to be an optimum
model in ecommerce.
Paytm invested heavily in cricket and TV advertising. This clearly created awareness and
provided credibility to the brand as it drew on the status of existing advertisers of major
sporting events.
Finally, demonetization in India in 2016 increased Paytm’ user base by over 20 million in less
than a month as people were forced away from cash banking towards online banking.