Paytm applies for P2P lending platform licence
23 March 2018
Paytm has applied for a licence to operate as a P2P lending platform, which would make it an intermediary providing loan facilitation services via the web or apps.
According to media reports, One97 Communications, the parent company of Paytm, recently sought clearance to carry on the business of a non-banking financial company – peer-to-peer.
Paytm, which has about seven million offline merchants, is also servicing them with small, short-term loans through its NBFC partners.
Last year, the RBI decided to treat peer-to-peer lending platforms as NBFCs. According to the central bank, the business of peer-to-peer lending means providing under a contract, loan facilitation via online or other medium.
The central bank considers P2P lending as a form of crowd funding used to raise unsecured loans, paid back with interest. The RBI aims to regulate the sector as well in a bid to prevent them from promising high returns.
Paytm has witnessed tremendous growth in recent months. The company will soon be registering a billion transactions every quarter. Its annualized gross transaction value has shot up to $20 billion.