Reserve Bank of India’s recent guidelines on digital lending are good for business according to Paytm MD & CEO Vijay Shekhar Sharma. ”Digital lending norms are very good norms, good for business, good for clarity”, Sharma said when asked about the RBI’s new rules on the sidelines of the Global Fintech Fest held in Mumbai.
Paytm offers consumer loans, merchant loans and Postpaid — where its loan distribution business in partnership with marquee financial institutions has been growing at rapid scale.
In an effort to protect the borrowers, the central bank released Guidelines on Digital Lending on September 2, 2022, to all lenders including digital lending apps like Paytm. The new rules make it mandatory for all loan providers to collect only essential data from the borrowers with their prior consent. The new rules on digital lending are to make the entire process transparent. RBI has also mandated that any charges on credit distribution must be between the loan service provider and the bank giving the loan.
At the Global Fintech Fest in Mumbai, Sharma said that India will lead by example, especially in payments, leading to financial services and that will be led by regulatory support. Sharma said, “The presence of the Government of India, the Reserve Bank of India at Global Fintech Fest 2022 is highly inspiring for young fintech entrepreneurs. We get energy from the Government’s support and vision of a digital economy.”
Pioneer of digital payments, Paytm continues to be the market leader in credit business as well with a 246% growth y-o-y disbursing over 6 million in July-August. The company has seen a strong growth momentum in credit distribution, in partnership with top financial institutions, with an annualised run rate ₹29,000 crore ($3.6 billion) in August. Paytm is committed to its mission of driving financial inclusion by offering easy-to-access loans to its users. With a growth of 484% y-o-y, total value of loans disbursed by Paytm aggregated to ₹4,517 Cr ($568 million) in July, August 2022.
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