HDFC Bank and Paytm in a strategic partnership will drive innovative digital solutions to bring about a financial transformation in India. The two leading financial platforms will combine their strengths in banking, lending and digital payments space.
Reports highlight that through this partnership, HDFC Bank’s salespersons will start selling Paytm’s payment solutions in the market. HDFC Bank will be the payment partner, while Paytm will be the distribution and software partner.
Bhavesh Gupta, Paytm Lending CEO, said the partnership will strengthen the financial services ecosystem by bringing together Paytm’s technology and digital solutions and HDFC Bank’s retail and credit prowess. Parag Rao, group head, payments, HDFC Bank, said through this partnership, they will be jointly delivering enhanced SmartHub solutions to the market. “We believe that this is the start of a great partnership and the cumulative strength of both HDFC Bank and Paytm will help us strengthen our respective leadership positions.”
HDFC Bank and Paytm will jointly offer merchants a combined package including a payment gateway and PoS machines in the first leg of the tie-up. Going forward they will also enable credit products including Paytm Postpaid (buy-now pay-later-BNPL) solution, Eazy EMI and Flexi Pay. IPO-bound Paytm is looking to consolidate its position in the merchant acquiring space, where it extends services beyond what is provided by banks.
Moreover, the fusion of HDFC Bank’s network, products and credit appraisal capabilities and Paytm’s technological platform will accelerate digital transformation in semi urban and rural India while bringing more people into formal banking channels. HDFC Bank is a strong player in the payments ecosystem with leadership in both credit card issuing and acquiring businesses. It has a footprint of over two million merchant acceptance points and are 48% business market share on merchant acquiring volume.
Furthermore, this collaboration aims to empower the new businesses and enable them to scale up further.