Major Fintech Paytm and the country’s largest private bank HDFC Bank Ltd have entered into a strategic partnership to provide financial solutions to end consumers and merchants across India.
Merger of HDFC Bank’s credit reporting network, products and capabilities and Patym’s technology platform will accelerate digital transformation in semi-urban and rural India, while attracting more people to the channels formal banking, the two companies said.
The strategic partnership with the country’s largest private bank precedes Paytm’s proposed initial public offering (IPO), through which the company plans to increase ??16,600 crore before the end of the calendar year.
The strategic partnership will see the two institutions launch innovative products in digital payments, loans and point-of-sale (POS) solutions.
Paytm and HDFC Bank will build complete solutions for payment gateways, point-of-sale machines and credit products, including Paytm Postpaid, which is a Buy Now Pay Later (BNPL) solution, Eazy EMI and Flexi Pay, have declared the companies.
The first stage of the partnership will include a payment gateway and point of sale solutions for Indian merchant partners. HDFC Bank will be the payment partner, while Paytm will be the distribution and software partner.
HDFC Bank will foster partnerships with merchants across India, to whom Paytm will offer its existing line of Android POS devices. HDFC Bank vendors will start selling Paytm payment solutions in the marketplace.
Paytm and HDFC Bank will also jointly launch a co-branded point-of-sale product in the retail segment, which Paytm will have the opportunity to offer to its own customers.
“Together, we aim to provide innovative digital lending and payment solutions to consumers and merchants. This partnership will strengthen the financial services ecosystem by bringing together our technology and digital solutions and the retail and credit prowess of HDFC Bank, ”said Bhavesh Gupta, CEO of Paytm Lending.
Paytm has more than 333 million users and 21 million merchants on its platform. HDFC Bank has over 50 million credit and debit card customers.
“Through this partnership, we will also jointly deliver improved SmartHub solutions. We think this is the start of a great partnership, ”said Parag Rao, Group Head, Payments, Consumer Credit, Digital and IT Banking, HDFC Bank.
