Paytm all set to go global through Aliyun
Paytm has signed a pact with Alibaba’s cloud computing arm AliCloud, and will be spending Rs.120 crore to deploy Alipay’s technology via Aliyun
New Delhi: Paytm and its largest investor Alibaba have entered into a commercial agreement that will allow the Indian payments firm to expand its network to global markets such as the US and China and, in turn, give Alibaba’s financial arm Alipay access to India’s fast-growing payments services industry.
Paytm, run by One97 Communications Ltd, has signed an exclusive commercial partnership with Alibaba’s cloud computing arm AliCloud, and will be spending about Rs.120 crore to deploy Alipay’s technology via AliCloud (also known as Aliyun).
The agreement will allow the payment instruments of the two firms to be integrated in their existing platforms. For instance, a Chinese customer shopping with Indian merchants will be allowed to pay via Alipay while an Indian Paytm user will have access to Alipay’s existing merchant base in markets such as the US, China, Japan and the UK.
The two firms will operate on a commission model.
The partnership comes at a time when the payments services business is heating up across the globe.
As online retail becomes a mainstream channel of commerce in India, backed by explosive growth of smartphones, the country is seeing large Internet businesses launch their own payment solutions in order to grab a slice of the nascent but fast-growing payments market. Cab aggregator Ola (run by ANI Technologies Pvt. Ltd) and e-commerce marketplace Snapdeal (Jasper Infotech Pvt. Ltd) are the latest to launch their own mobile wallets.
Paytm’s founder Vijay Shekhar Sharma was one of the 11 recipients of a payments bank licence from the Reserve Bank of India in August. The company plans to use Aliyun to build its financial services play.
“The battle is to build significant business and with the help of Aliyun and Alipay services, we will be able to build faster and accelerate,” said Sharma. “This is part of our payments play in the country.”
“With Aliyun platform we will have access to services such as data analytics and insights into customer trends across markets where Alipay is present and it will help us build stronger merchant data base,” added Sharma.
Aliyun will also allow the company to have access to Alipay’s expertise in areas such as NFC (near-field communication).
“It will also help us become stronger in fraud detection,” said Sharma.
For now, Paytm will leverage the bank account linked to the Paytm wallet to allow Indian consumers to pay in markets outside India. Once its own payments bank starts operation, this will happen seamlessly via Paytm itself.
Paytm has been working with Aliyun on the platform for nearly six months now. A team of 20 people from Aliyun is operating out of Paytm’s office in Noida helping the two firms to roll out the cloud services.
Paytm will host the data in its data-centres in Mumbai and Delhi. “The financial data will remain within Indian borders,” said Sharma. The company currently has two data-centres in Mumbai and one in Delhi.
Paytm, also backed by venture capital firm SAIF Partners, has more than 120 million wallets and sees an average of 60 million transactions in a month. It processes close to Rs.1,700 crore worth of transactions in a month and has 160,000 merchants on its e-commerce platform.
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