PAYTM’S

SUCCESS STORY

How did it become one of

India’s most valued
startups?
 About Paytm
• The acronym for ‘Pay through mobile’  Paytm had been established in 2010 by Vijay Shekhar
Sharma.  Paytm is primarily an Indian e-commerce website as well as an application that allows its
users to practice online payment for various services. 
• At first, this digital payment platform was adopted for undertaking payments for limited utilities
such as mobile, DTH recharge, and shopping bills. Yet over the last couple of years, the platform
has enhanced its scope and has engaged a wide range of services within the umbrella of its
operations. 
The platform presently permits its users to recharge through their
mobile number for services such as paying their utility bills,
transferring funds to other bank accounts, booking tickets for
flights, trains or buses or booking hotel reservations,  and receive
many gift vouchers or cashback offers.
 i
•  Paytm is a prominent financial services firm that facilitates various financial solutions
to its customers via offline as well as online platforms. The platform’s parent
organization is One97 Communications which is based in Uttar Pradesh’s Noida.
• Paytm alongside One97 Communications is the owner of Paytm Payments Bank which
holds over 58 million account holders. The platform’s subsidiary ‘Paytm Money’ is
considered to be the nation’s biggest investment platform and is also one of the biggest
contributors of Systematic Investment Plans (SIP) to the Mutual Funds Industry.
 Paytm’s founder
The founder of Paytm is Vijay Shekhar Sharma. Being a student of the Delhi College of
Engineering he began his entrepreneurial venture sometime in 1997 through his insider.net
website. This company was later on sold and the amount raised was used to launch the parent
company of Paytm, i.e, One97 Communications in 2000 which continues to be headed by him.
 He was ranked as India's youngest billionaire in 2017 by Forbes with a net worth of $1.3
billion. He has been featured in Times magazine World's 100 Most Influential People 2017 List .
He is the recipient of Yash Bharati the highest civilian honour of the Government of Uttar
Pradesh. In 2020, he was ranked as the #62nd richest person in India, with a net worth of
US$2.35 billion, according to  Forbes
STORY BEHIND THE
MAGNANIMOUS START
UP : PAYTM
 An idea can change the world
Vijay Shekhar took a tour of the whole world and reached Beijing. There he encountered that
Beijing was fastly growing in terms of technology. He was startled to see that every number is a
hundred times bigger than India. 
He felt if a country like China can do this, then why can’t India. It was there when the idea to
build a payment platform came to his mind. But the Board of Directors rejected the idea. They
believed that cash is king in India and the countrymen won’t approve the digital transaction. It is
a matter of amusement that Vijay Shekhar was given an amount of Rs 5 crores for six months to
take a chance on whether Paytm will be built or not. Finally, the idea of Paytm was executed and
the rest is history.
When there is a will, there is a way. 
• Vijay Shekhar observed the growing phenomenal use of smartphones. He wanted to contribute
to society so that people could use smartphones to do the transaction online. On 8th July 2010,
an online website was launched called Paytm.com under its parent company One97
Communications. 
• Initially, it served only from online prepaid mobile and online DTH facilities. Within a couple
of days, it popularized among people due to its paying facility of electricity bill, water bill, and
gas bill facility. Paytm made people’s life easy. Within 2 years, its users increased to two lakh
fifty thousand. Paytm had become a popular name in the world of e-commerce.
Business Model
"Payment is a no-margin business. Money will be made on content, commerce, and
advertising. And then, we will build financial services on top of that,"- Vijay Shekhar
Sharma 
• Paytm has laid the foundation for the various other digital payment platforms
we observe in the Indian nation, as it sets an example from which these
companies can observe and imbibe from. Initially Paytm limited its focus
towards the requirements of the younger population and later on extended its
emphasis to incorporate the older Indian population as well.
• From being a mere recharge and bills payment platform the organization has
expanded to emerge as an online banking service kind of website that offers a
plethora of offers as well as services. The platform is one of the rare payment
sites that facilitates a 50- 100% cashback in pretty much all the payment
transactions undertaken by the user.
• The application facilitates the customers with an e-wallet feature that allows
them to store a section of the amount exclusively for particular transactions.
paytm’s platform also facilitates online booking as well as reservation services.
The platform functions as a sort of marketplace that permits users to execute
their daily requirements easily.  It is also a virtual bank that has been approved
by the Reserve Bank of India. 

• The platform has also launched the idea of Digital Gold through which the
users can perform online purchasing and selling of gold. They contain an all-
time functioning customer service facility that promptly resolves any problems
relating to the application.
Paytm’s growth
• Paytm payment bank became the first bank in India to offer a zero balance current account
facility. The initial investment of Paytm was $2 billion in Noida, Uttar Pradesh. It served two
countries India and Canada. 
• Its products are Paytm money, Paytm Gamepad, Paytm smart retail and Paytm post paid,
Paytm wallet, Paytm mall. In 2014, Paytm launched Paytm wallet and initially the Indian
railways and Uber accepted the concept of wallet for payment and others followed the
league. 
• In 2017, Paytm became India’s first payment app with 100 million downloads of the
application.
• In recent news, as confirmed by Financial Express, at the start of September Paytm declared
its launch of a subscription service for businesses. Titled as ‘Paytm Subscriptions’, the
service aims to allow businesses to gather payments from their users through flexible and
easy payment methods like Paytm wallets, cards, or UPI. 

• As confirmed by Mint, Paytm had witnessed a large loss in its revenue in the midst of FY
2018-19. In the fiscal year of 2019, the platform witnessed a mere 2% hike in revenue,
whereas its expenses grew by 54%. The paytm Payments Bank Limited platform
announced that its net profit in FY 19-20 escalated to Rs.29.8 Cr from Rs.19.2 Cr in the
last year, resulting in an escalation of 55%
 Demonetisation: How did Paytm gain from note ban?
• The demonetisation drive of 2016 has by far been one of the most significant economic events
of the nation. In a nation where liquid cash accounted for about 96percent of the monetary
transactions before this unexpected declaration, a large section of India’s population was badly
hit by the liquidity crunch that followed. We may observe the upward trend in the amount of
digital payments which resulted out of Prime Minister Shree Narendra Modi’s unceasing efforts
of transforming the nation into a cashless economy. Mobile wallet (m-wallet) platforms found
themselves to be in a lucrative position while exploiting the underlying opportunities in the
midst of this challenge.
PAYTM’S MARKETING STRATEGY
DURING DEMONETISATION
Twitter campaigns assuring a fitting solution to the cash crunch problem:
• With ATMs running out of cash and the lead time being too long for the new denomination
currency notes of INR 2000 to reach the ATMs, there was immense panic as to the long
waiting lines at the banks and the useless 500 and 1000 rupee notes in hand. As a solution to
this, Paytm came up with a series of tweets; one being “We have got two words for you:
Paytm Karo” followed by the other “Ab ATM nahin Paytm Karo” which were retweeted
several times to ensure a wide reach and educate individuals about going cashless
Aggressive advertising across
print media

November 9, 2016, the very next day of the

announcement going public, Paytm came up
with full page
ads in every leading newspaper of the
country advocating their support in favour of
Modiji’s bold move
aimed at transforming the nation into a
cashless economy. Their ad campaigns were
supported by a
25 trendy hashtag saying #Ab ATM nai
Paytmkaro
Addressing day-to-day problems faced during the cash crisis:
•It was quite impractical and tough to transact in INR 2000 denominations for daily needs items. In an attempt to address this issue,
Paytm came up with a television commercial “Chutte Ki Chinta mat Karo, Paytm Karo” depicting how people were in a cash-
strapped situation finding it difficult to purchase their daily groceries and making other miscellaneous payments. The advertisement
convinced the consumers that Paytm would relieve them of this hassle by making direct money transfer possible through their
respective Paytm accounts. Another campaign “Shadi ka shagun cash nai, Paytm karo” gained popularity as demonetisation was
declared during the wedding season.
The QR Code Scanner facility at the bottom of the pyramid:
•On account of its massive advertising campaigns, Paytm became very popular among small merchants as well. The method of
registering themselves and conducting transactions was quite simple. One could find Puchkawalas, Chaiwalas, Paanwalas and the
local kirana stores employing this mode of transacting money. You would just have to scan the unique QR code offered to each
retailer for making a payment.
Paytm’s role in the economy today
Paytm started off as merely a mobile recharge website. Emerging as an
e-commerce platform now known as Paytm Mall (featuring 1000 brand
stores and 15000 brand –authorized retailers offering 32 about 65
million products), Paytm not only offered an interface to shop for
categories like apparels, electronics, shoes, home furnishings,
accessories and the like but also offered facilities for movie bookings,
flight bookings, events, amusement parks, hotels and so on with
attractive cashback offer and discounts. Paytm wallet enables a user to
transfer money from his bank account to his paytm account in order to
make bill payments and transfer money. From its bargaining feature to
enabling users to make payments in offline mode, Paytm has now
achieved the status of being a Payments Bank licensed by RBI. A
recent and a quite appealing feature developed by Paytm was its Digital
Gold facility which enables a customer to buy, sell or store gold at no
transaction cost except a small fee to be paid for making or delivery
charges.
 Conclusion

The value proposition of a mobile wallet is not only underlying in the payments feature,
but also the value-added services that can be offered across a mobile-enabled
environment. No one wants to be left behind in this race of customer acquisition in a
rapidly changing and intensely competitive environment. All of them seem to be coming
up with attractive offers and unrealistic discounts. The question here is, in the name of
customer acquisition/retention, is this strategy justifiable or long-lasting? Million-dollar
investments are being pumped into the mobile payments industry. While the mobile wallet
industry has a lot to promise on the outside, it has caused the valuation of many public
companies to be inflated.
Paytm has been revolutionizing and updating its services in accordance with
the shifting requirements of its users as well as the industry. This is the primary
reason why the platform’s user base is escalating on a daily basis. paytm has
set a collection of dynamic plans for the upcoming years which lays the
foundation of a promising future for the platform, facilitating a service where
its users receive an exciting overall experience.  
Paytm, backed by Japan's SoftBank and China's Alibaba, has filed for a $2.2
billion IPO, which is expected in November. The Noida-based company was
last valued at $16 billion.
"I don't follow the fintech industry. I
follow the journey of a customer. Over a
period of time, we will be an internet
ecosystem in India with the largest pool
of users. It has happened in the US and
in China.”
- Vijay Shekhar Sharma, founder & CEO, paytm
References
• www.analyticssteps.com
• www.researchgate.in
• www.convey.in
• www.economictimes.indiatimes.com
• www.paytm.com
• www.businessconnectindia.com