8/7/2023 0 Comments Ipobound paytm![]() Paytm's banking unit doesn't even have $1 billion yet. 1 issuer of tags for vehicles to pay tolls electronically, Paytm isn't doing too badly in originating transactions, either. It had a higher market share last month than the State Bank of India, the country's largest lender. When you look at where digital money goes in India after it's transferred online, Paytm's bank is at the top of the heap in receiving funds. (Until recently, the limit was half that amount.) Even then, Indians clearly see some value in their Paytm Payments Bank accounts. That's because Paytm only operates a so-called payments bank, which is barred from making loans, issuing credit cards or keeping more than 200,000 rupees in deposits per customer. It's KakaoBank's $20 billion deposits that make the difference. The platform handled 4 trillion rupees ($54 billion) worth of payments to merchants last year, similar to Kakao Pay's 67 trillion won ($58 billion). In India, Paytm - shorthand for "pay through mobile" - has come some distance from its roots as a tool for people to recharge their pre-paid phone accounts and pay for Uber rides. No wonder, then, that KakaoBank's post-IPO market value won't rank too far behind that of the largest retail lenders, KB Financial Group Inc. KakaoBank, which currently competes in 14% of the country's won-denominated debt market, will in 12 to 18 months start attacking 65% of the market, Moody's says. That's a big advantage over traditional lenders that "lack a platform to attract customers and collect data from nonfinancial services, as well as incur higher costs to maintain physical branches," according to Moody's Investors Service. From within the popular, 11-year-old messaging service - parent Kakao Corp.'s first big success - users can access the Kakao Pay wallet for cashless person-to-person and in-store payments. Face-to-face contact offers little additional information to the lender, given that 90% of the population is on KakaoTalk. When younger tenants approach the internet-only KakaoBank for loans to lease apartments - known in Korea as "jeonse" - they don't have to show up at a branch, which doesn't exist anyway. ![]() The tempo is being set by customers in their 20s and 30s who don't care much about banks as brick-and-mortar institutions but want to consume banking online like any other service, customized to their spending patterns and investment priorities. ![]() Additionally, exposure to a Korean new-age virtual bank or an Indian fintech gives yield-starved global investors a hiding place from Beijing's unpredictable regulatory action against China's tech titans, including Ant.īut there's more going on at KakaoBank, something that might also be relevant to Paytm. Internet-based businesses are raising funds at a record pace, making use of the boost given by the pandemic to all things digital. ![]()
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