New Delhi: Mobile payments processor Paytm hopes to cross monthly annualized sale of $4 billion in gross merchandising value (GMV, or price of goods sold) by December, with nearly half of it coming from its marketplace business, a top company executive said.

Paytm, backed by China’s Alibaba Group Holding Ltd affiliate Alipay Singapore E-Commerce Pvt. Ltd, is now trying to build India’s Taobao and has launched its app Seller for Paytm on Friday that allows sellers to list their products without paying any commission.

Taobao is an online marketplace in China operated by the Alibaba Group.

Large marketplaces such as, eBay Inc. and Inc. charge a small commission from the sellers to list their products on their platform.

“This is what Taobao did to fight eBay in China," said Vijay Shekhar Sharma, the co-founder and chief of Paytm, who owns close to 27% of the company.

Noida-based Paytm, which launched its marketplace in late 2014, is getting a third of its total GMV from the marketplace, said Sharma. “We are currently doing close to $500 million from the marketplace alone," he said.

Paytm, run by One97 Communications Ltd, is aggressively pushing to build its mobile marketplace, a move that has put the company in direct competition with Tiger Global-backed Flipkart, Amazon and Softbank-funded Snapdeal.

A late entrant in the online marketplace, Paytm is taking steps to fight the competition and climb up the ladder.

Paytm is trying to build a large marketplace for the unstructured categories while some of its large competitors are focused on branded and structured categories such as electronics and books, said Sharma.

Paytm has 30,000 merchants on its platform and is expecting to touch close to 100,000 by the year-end after it allows zero-commission listings. The company, which is yet to turn profitable, will charge the sellers a 2.5% transaction fee every time a sale happens via the platform.

“Profitability is not a concern for me right now. I only care about how many small and medium businesses are using Paytm platform and how many users are transacting on it," said Eric Jing, chief operating officer at Ant Financial, who was in India to attend Paytm’s board meeting on Friday.

In February this year, Alipay announced plans to buy a 25% stake in Paytm, in a move to tap the fast-growing mobile payments business.

Paytm has so far received $65 million for a 10.2% stake in the company.

The second tranche of $135 million that will take Alibaba’s stake to 25.88% is expected to follow within this year. The venture capital firm SAIF Partners holds close to 37% stake in the company, according to Sharma.

Paytm is expecting to cross over a billion transactions on its platform by December, riding on the two new mobile applications it introduced. The company also launched a Mobile Wallet that will allow consumers to do peer-to-peer money transfers.

Paytm will also create 50,000 store fronts by June where people will be allowed to load money in their Paytm mobile wallets. It has also tied-up with Axis Bank Ltd to act as one of the store fronts for uploading money.

The company has over 66 million wallets on its platform and expects the number to cross 100 million by December.

Paytm is aggressively reaching out to the masses, including the autorickshaw and cab drivers who are opting for a mobile wallet for a hassle-free payment method, said Sharma.

Taxi-hailing service Uber and online train ticket-booking platform IRCTC are among the companies that accept Paytm’s wallet for transactions.

The e-commerce firm allows inter-wallet money transfers and wallet-to-bank transfers where a customer can transfer the money stored in the wallet to a bank account.

Digital or virtual wallets act as a holder of cash that resides in a mobile device or personal computer and can be used to purchase goods and services online.

These can be loaded with cash through a mobile payment provider, online banking or through telecom operators.

Digital wallets can be closed, semi-closed or open. Closed wallets allow consumers to purchase goods and services from only one seller. Semi-closed wallets allow shopping at multiple merchants in a marketplace.

Paytm is investing aggressively on advertising and is expected to spend close to 500 crore by December 2015.

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