On 8th November, we lost our Rs 500 and Rs 1000 note to Prime Minister’s move of demonetization. That left all of us shocked and in a state of pandemonium but there was one App among many that came to our rescue. The online wallet service: Paytm.
Now, digital payments firm taking a step further announced that from 15th January 2017 it will no longer remain only a m-wallet service and is set to transfer to a Payments Bank.
What is a Payments Bank?
Payments Bank is a new model of mobile banks. Customers can operate both types of accounts: current and savings in this type of banks. It offers services like ATM cards, debit cards, online and mobile banking but cannot offer loans or credit cards. This model was conceptualized by RBI.
Paytm will be India’s second such bank after mobile service provider Bharti Airtel’s “Airtel Payments Bank” that launched on Thursday, 12th January 2017 . It promises to offer 7.25% interest rate and many more facilities.
So what’s the fate of the money in your current Paytm wallets?
Various rumors broke out on social medias that users will no longer be able to use or access their Paytm wallets and lose out all their money. Paytm clarified this in a blog post that said this couldn’t be “farther from the truth”. Whatever balance is in your current wallet will reflect in your new Paytm Payments Bank Wallets. This shift will happen automatically where m-wallets will continue to work even after 15th January.
What will come with Paytm changing into a Payments Bank?
Online payments service announced that it will soon bring out additional benefits like that of holding a checkbook, a debit cards and earning interest on the amount in our account. The interest rate is yet to announced. Also, customers are not bound to open an account with them to keep on using the m-wallet service. It is just a transfer of ownership to a new company.
Customers even have a separate option to open a bank account with the payments bank if one decides and desires to do so. They also have an option to opt-out of having a Payments Bank Wallet with the company.
So you can still pay your bills, buy your movie tickets and avail all the services provided from the beginning and look forward to many more benefits from this move of chains in a mobile bank. For more information check out the blog post by the new payments bank here.