Paytm Money, the financial services platform of Paytm has received SEBI’s approval to become an RIA.
This will allow the company to roll out advisory and wealth management services to consumers across the country, it said in a press release.
"Paytm Money is currently completing integration with the respective compliance and regulatory authorities for KYC under the SEBI regulations. It is also integrating all leading AMCs (Asset Management Companies) in India,” the release stated.
“We are committed in our mission to make wealth management easier and more accessible for the masses. The SEBI approval to our request for an Investment Adviser license puts us on track for our planned launch date of April. We are working with our partners to ensure our customers the simplest and most transparent consumer experience ever available in India," said Pravin Jadhav, Senior Vice President, Paytm Money.
Sources said that the company will invest $10 million (approx. Rs.64 crore) in its wealth management business. This will make it among the best funded start ups even in the history of Indian financial services distribution business.
This intensifies the competition in online financial distribution space. Currently, many online distribution firms sell regular plans to its users.
One97 Communications, more popularly known as Paytm is backed by the Chinese e-commerce giant, Alibaba. It is pertinent to mention here that its promoter Alibaba followed a strategy of deploying the surplus funds of their sellers in liquid funds through their wealth advisory arm Ant Financials (then Alipay), which proved to be a big success. Later, the company expanded their distribution business by offering other mutual fund schemes and financial products.
Cafemutual had earlier reported in January that Paytm will start distribution of financial products like insurance and mutual funds and they had approached fund officials seeking advice on the execution of its financial distribution business. The source had then told Cafemutual, the company will focus on distributing direct plans of mutual funds and subsequently move to fee-based model.
