From its beginnings during dotcom bubble as a mobile value added services company, to becoming the fastest-growing payments players in the country, Vijay Shekhar Sharma’s One 97 Communications has become one of the most valued digital companies in India with mobile wallet brand Paytm.
Now with backing from both Alibaba and SoftBank, Sharma spoke about Masayoshi Son’s advice to him and his plans for Paytm in the future. Excerpts:
Q: Does this round of funding give you enough ammunition to take on incumbent banks and potential new entrants in the payments space?
A: We plan to invest Rs 10,000 crore over the next 3-5 years towards our commitment to promoting financial inclusion and enabling half-a-billion Indians to join the mainstream economy. We have to do a good job of tech and distribution to make it possible. We don’t have to fight with banks to win. We are in nearly a blue ocean when we see our target customers and businesses. Traditional banks and financial institutions are complementary and partners in our business.
Q: Will we see Paytm working more closely with SoftBank’s portfolio firms in India post this transaction?
A: We want to work with everyone who is building online and offline payment-led businesses. It will be great to find out synergies together in SoftBank’s portfolio in India.
Q: Did Masayoshi Son give you any advice?
A: He said, “Build a very long-term horizon company“. Not 10-15 years, but a 25-30 years business landscape. That’s exactly what is incredible about SoftBank’s investment. It is a long-term capital. We now probably have the most long-term, large capital on any company cap-table in India.
Q: How big of an issue will the recent RBI move towards full PPI KYC be for the mobile wallet industry? What kind of an impact will it have on Paytm’s customer base?
A: I believe it’s a great opportunity for us to acquire banking customers. We will anyway get KYCs done while opening bank accounts.
Q: Which are some of your next big investment areas?
A: We believe that everything that a consumer can buy using the mobile phone will be an important area for us. Digital goods O2O (offline to online) are great moats in that. We want to be a dominating force in travel, ticketing and deals businesses.
We also forked out our e-Commerce business and raised separate capital to support small businesses against online retailers. We want to be the force to empower small business with various financial and commerce services to fight big (online) companies.
Q: Will insurance and lending be the big focus areas with the Payments Bank set to become operational?
A: The payments bank will not do any lending. Our lending and insurance businesses are about partnering with various lenders and insurance companies and making them available to consumers & small businesses. In India, if you go beyond the top 250 million customers and few million businesses, lending is costly, informal and very risky. We want to solve that with technology and data technologies. It is a great time to be in the financial services sector in India.
Source: The Economic Times
