Ever since Paytm announced the transfer of all Paytm wallet users to their new Payments Bank, there has been a strong under-current of whispers and gossips regarding their ‘Chinese connection’.
On a general level, people are aware that Alibaba is invested truck loads of money into Paytm, but details of how much stake Alibaba owns in their new payments bank was still unknown.
This led to rumors, and allegations that Paytm will become a front for Chinese capitalists, and the money earned by Indians will go them now.
This under-current of negativity was clearly evident, when Paytm founder Vijay Shekhar Sharma shared an image, wherein someone had compared SBI, an Indian bank with Paytm Payments Bank, a Chinese company.
Now, to balance the negativity, he also shared the image of the ‘Future of Fintech Impact Awards 2016’ he received from Financial Times, thereby implying the difference between a 100 year old bank and a new, upcoming and disruptive banking platform.
Paytm’s Chinese Connection Can Spell Trouble?
Few days back, a report had emerged that RSS, the right wing Hindu organization, will ‘investigate’ Paytm’s ‘Chinese connection’. This investigation would be conducted by Swadeshi Jagran Manch (SJM), which has been running campaigns against inflow of Chinese goods in India.
Ashwani Mahajan, co-convener of SJM, had said: “We have seen several reports about major Chinese stake in Paytm. Now that we are going for cashless transactions, we want to ensure the data shared by Indians is safe. No Indian company should be sharing data with foreign companies and the investment routes should be made very transparent,”
In reply, Vijay Shekhar Sharma had said last month, “We are as Indian as Maruti is…we are ‘India story’ in every sense whatsoever,” The Maruti example was given because once Govt. controlled, Maruti is right now majority owned by Japanese carmaker Suzuki Motor Corp with a 56.21 per cent stake as its sole promoter.
Sharma had clarified, “What matters to us is our customers, what matters to us is the law of land, regulator…”
Paytm’s Firm Reply To Allegations and Doubts
None the less, a blog has been published by Paytm, wherein the doubts and apprehensions have been addressed for all.
Major pointers:
– Paytm Payments Bank Limited an Indian company, whose 51% stake lies with Vijay Shekhar Sharma and 49% of the ownership is with One97 Communications Limited. (what is not mentioned in the blog is that Alibaba and Ant Financial, affiliate of Alibaba has invested $680 million into One97, thereby having 40% stake in the company)
– Money transfer from Paytm to any bank account would happen at 0%, even after December 31st
– Existing users of Paytm wallet wont be converted into bank customers of Paytm Payments Bank. The current transfer is merely a transfer of the company, not its users.
– Once the bank is launched, Paytm wallet users would get an option to open their bank accounts,and those who don’t want to open, can opt out. Hence, using Paytm wallet under Payments Bank wont make it necessary to have a bank account as well.
– Paytm wallet would be different from Payments Bank by Paytm
We will keep you updated as the story unfolds.
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