Rollback on Policy to Add Money on Mobile Wallet Using Credit Card

Customers using Paytm will not pay levy of 2% for recharging their mobile wallet using credit cards.

India: Alibaba backed, mobile wallet service provider, Paytm rolled back its decision to charge 2% transaction cost for the customers choosing to recharge their wallets with credit card. The company took the original decision after discovering the users gaining credit points after adding money in their wallets with credit cards and then, at no cost, transferring the amount back into their accounts.

Paytm business model drives revenue from customers spending amount in their wallets on company’s network. The company profits from margins on products and services offered on its network. With users misusing the portal, Paytm decided to charge on credit cards transactions to protect its genuine customers before suspending it 24 hours later.

The company’s spokesperson said, “Keeping the millions of customers and merchants interest as utmost priority, we have decided to suspend the 2 percent fees and will continue to build a series of features to curb such misuse.”

TechSci Research depicts that mobile wallet market has risen at an accelerated pace in back of Government of India’s decision to ban currency notes of Rupee 500 and 1,000, which has developed market for new players to enter into increasing market competition. The market is expected to rise with companies offering low cost options for availing services such as recharge and money transfer.

According to report published by Techsci Research, “India Mobile Wallet Market By Application, By End User, Competition Forecast & Opportunities, 2012 - 2021”, the market for mobile wallets in India is projected to grow at a CAGR over 50% during 2016 – 2021. Evolving technologies, secure authentication process, rising adoption of online payments and growing e-commerce transactions are anticipated to significantly boost India mobile wallet market in the coming years.