Home / Money / Personal Finance /  Google ties up with fintech to let its users open FDs on GPay

Google has teamed up with Setu, a fintech specialising in providing application programming interfaces (APIs), to allow its users to book fixed deposits (FDs) through Google Pay, a person with knowledge of the matter said on the condition of anonymity.

In the initial roll-out, FDs of Equitas Small Finance Bank will be offered for up to one year. The maximum interest rate is 6.35%. Users will have to complete an Aadhaar-based KYC (know your customer) through a one-time password (OTP).

Setu has already created a beta version for the API, which Mint has reviewed. A second person with knowledge of the matter confirmed the development.

“The beauty of the system is that you can book an Equitas FD on Google Pay even if you do not have a savings account in Equitas Small Finance Bank. The money will flow out of your existing account and back into your existing savings account. Other banks, including Ujjivan Small Finance Bank and AU Small Finance Bank, are also in the pipeline. If successful, the system will also be extended to other payment apps," said the second person. “While attention is usually focused on mutual funds and stocks, FDs are the largest component of savings in India. They are largely overlooked," he said.

The beta version of the API offers FDs of various tenors including 7-29 days, 30-45 days, 46-90 days, 91-180 days, 181-364 days, and 365 days, with interest rates ranging from 3.5% for the shortest FD to 6.35% for the one-year FD. According to media reports, Google Pay has 150 million monthly active users in India.

Small finance banks have aggressively teamed up with fintechs to offer high-interest savings accounts and fixed deposits. Equitas Small Finance Bank has partnered with fintechs such as NiYO and Freo (Moneytap) to offer its savings accounts with interest rates of 7% for balances more than 1 lakh. Under Reserve Bank of India rules, small finance banks have to lend at least 75% of their adjusted net bank credit to priority sectors compared with 40% for scheduled commercial banks. At least 50% of their portfolios must consist of loans up to 25 lakh.

Neil Borate
Neil heads the personal finance team at Mint. A former colleague called them 'money nerds' and that's what they are. They cover topics like mutual funds, taxation and retirement, all to improve your chances of building wealth. Neil graduated with a degree in law and economics. He passed the CFA Level I exam and began his writing career at Value Research, a mutual fund research firm in 2016. He joined the personal finance team Mint in 2019. Everyday, the Mint Money Team tackles personal finance questions such as where to invest and where to borrow, through articles, charts and reader queries. They also have a daily podcast - 'Why Not Mint Money' and an annual ranking of mutual funds - the Mint 20.
Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Recommended For You
Get alerts on WhatsApp
Set Preferences My ReadsWatchlistFeedbackRedeem a Gift CardLogout