Paytm founder Vijay Shekhar Sharma said the company will approach the government and RBI for a small bank finance license.
Paytm intends to convert its payments bank into a small finance lender as it looks to chart a more profitable growth model, founder Vijay Shekhar Sharma told The Times of India.
Sharma said the company will approach the government and the Reserve Bank of India (RBI) for a small bank finance license.
"We are keen to be a small finance bank. If the regulator gives the nod, we will definitely want to pursue this," Sharma told the publication.
Sharma owns 51 percent of the payments bank and the rest is held by One97 Communications, Paytm's parent company.
"The very purpose of introducing differentiated banks was financial inclusion. After becoming a payments bank, it has been realised that in order to achieve the underlying vision, there is immediate need to allow payments banks to offer small-value credit to its customers," Sharma said.Also read: Evolution of banking in India – Are we there yet?
The move comes shortly after Paytm had a fresh round of fundraising, worth $1 billion. The financing was led by US-based asset management firm T Rowe Price and valued Paytm at $16 billion.
Existing investors Ant Financial and SoftBank also participated in the investment round.
Aditya Birla Idea Payments Bank recently closed operations after "unanticipated developments" made the business model unviable.