A

PROJECT REPORT
On

“FINANCING PLANNING AND FORECASTING OF

PAYTM”

Submitted towards Partial Fulfillment of

MASTER OF BUSINESS ADMINISTRATION

(AFFILIATED TO AKTU, LUCKNOW)

(2021-2023)

Under the guidance of

Submitted to: Submitted By:

Dr. Aakash Chabaque Rachit Jain

Director MBA Ist Sem.

 CERTIFICATE

This is to certify that the report titled “Financing planning and Forecasting of
Paytm” being submitted by Rachit Jain, in partial fulfillment of the requirements
for the award of the Degree of Master of Business Administration, is a bonafide
record of the project work done by RACHIT JAIN of MBA, KITE MEERUT.

Dr. Aakash Chabaque Dr. Aakash Chabaque

Director Director
 STUDENT DECLARATION

I undersigned, hereby declare that the project titled “FINANCING PLANNING

AND FORECASTING OF PAYTM” submitted in partial fulfillment for the
award of Degree of Master of Business Administration of A P J Abdul Kalam
Technological University is a bonafide record of work done by me under the
guidance of DR. AAKASH CHABAQUE, DIRECTOR, KITE MEERUT.

This report has not previously formed the basis for the award of any degree,
diploma, or similar title of any university.

Date: RACHIT JAIN

 ACKNOWLEDGEMENT

Through this acknowledgement I express my sincere gratitude towards all those

people who helped me in this project, which has been a learning experience.

This space wouldn’t be enough to extend my warm gratitude towards my project

guide DR. AAKASH CHABAQUE for her efforts in coordinating with my work
and guiding in right direction.

I escalate a heartfelt regards to our institution director DR.AAKASH

CHABAQUE for giving me the essential hand in concluding this work.

It would be injustice to proceed without acknowledging those vital supports I

received from my beloved classmates and friends, without whom I would have
been half done.

I also use this space to offer my sincere love to my parents and all others who had
been there, helping me walk through this work.

RACHIT JAIN
MINI PROJECT ON
 CONTENTS

1. EXECUTIVE SUMMARY

2. INTRODUCTION TO E-COMMERCE
o Introduction
o Origin and development
o Online to offline model- concept
o Paytm online to offline model
o Paytm- at a glance

3. OBJECTIVES OF THE STUDY

4. COMPANY PROFILE
o Profile of the Organisation
o Problem to Paytm

5. S.W.O.T. ANALYSIS OF PAYTM

6. MARKET PLAN
o Strategy of Paytm
o Problem to paytm

7. FEASABILITY STUDY
o Products and Services
o List of key personnel in Paytm
o Revenue Model of Paytm
o Value chain of Paytm

8. FINDINGS

9. LIMITATIONS
10.CONCLUSION

11. BIBLOGRAPHY
 EXECUTIVE SUMMARY

The marketing research project report has been written keeping in mind the Indian
(Delhi NCR being the focus) operations of PAYTM.COM - India’s largest mobile
commerce platform. Paytm a consumer brand of India’s leading mobile internet
company One97 Communications started by offering mobile recharge and utility
bill payments and offers a full marketplace to consumers on its mobile apps.

The company aims at making stuff easy and intuitive In addition to usability, it
strives to create accessibility, convenience and credibility.

O2O the acronym, which stands for both online-to-offline and offline-to-online
business, refers to strategies to get more online shoppers into brick-and-mortar
businesses or, on the flipside, to convince people who prefer physical transactions
to try out online commerce and payments for the first time.

By adapting O2O Model Company desires to enter into the routine payment
chain as it believes that Indians will prefer to use Paytm for small purchases
because In India’s economy, every rupee matters. People don’t want to pay tips or
anything extra and by using Paytm they can pay the exact amount like 67 rupees,
instead of rounding them off, giving it an edge over cash since providers don’t
have to carry tons of change.

Paytm is marketing its O2O strategy to the regular population as a convenient

cash substitute that saves your time, money and hassle of carrying change all the
time. Paytm also has an edge over credit and debit cards as it does not charge
processing fees and the app is faster to use than card readers.
CHAPTER:

INTRODUCTION TO E- COMMERCE
1. a Introduction

At first, the term ecommerce meant the process of execution of commercial

transactions electronically with the help of the leading technologies such as
Electronic Data Interchange (EDI) and Electronic Funds Transfer (EFT) which
gave an opportunity for users to exchange business information and do electronic
transactions.

Electronic commerce is a term for any type of business, or commercial

transaction that involves the transfer of information across the Internet. It covers a
range of different types of businesses, from consumer based retailsites, through
auction or music sites, to business exchanges trading goods and services between
corporations. It is currently one of the most important aspects of the Internet.

Although the Internet began to advance in popularity among the general public in
1994, it took approximately four years to develop the security protocols (for
example, HTTP) and DSL which allowed rapid access and a persistent connection
to the Internet. In 2000 the meaning of the word ecommerce was changed. People
began to define the term ecommerce as the process of purchasing of available
goods and services over the Internet using secure connections and electronic
payment services.

Ecommerce allows consumers to electronically exchange goods and services with

no barriers of time or distance. It has expanded rapidly over the years and is
predicted to continue at this rate, or even accelerate. In the near future the
boundaries between "conventional" and "electronic" commerce will become
increasingly blurred as more and more businesses move sections of their
operations onto the Internet.
1.b Origin and development

Origin

The rise of internet companies in India started in the mid-1990s. The first Indian
internet companies mainly featured online classifieds, matrimonial and job
portals. The low penetration of internet, lack of awareness and lack of
development and confidence in online payment systems were reasons for Indian
internet companies not actively engaging in e-commerce. It was only in the mid-
2000s, after the dot com bubble burst that ecommerce industry in India started to
take off. The first e-commerce services available were mainly offered in the travel
industry. With the proliferation of low cost carrier airlines, ticket offering started
to be made online.

The evolution of e-Commerce in India can be broadly divided into two phases
based on the emergence of various sub-segments.

1.First wave: advent of online Naukri and Shaadi

The introduction of internet in India in 1995 marked the beginning of the first
wave of e-Commerce in the country. Moreover, economic liberalization after the
launch of reforms in 1991 attracted MNCs and brought about the growth of the IT
industry. The implementation of liberalization policies led to the demise 5 of the
license regime, and high taxes and import restrictions, as well as facilitated the
growth of SMEs. The IT industry and SMEs were the early adopters of internet.
This led to the emergence of B2B, job searches and matrimonial portals.

B2B directory: India’s first online B2B directory was launched in 1996. The
liberalization of the country’s international trade policies was the key factor that
accelerated the growth of B2B online portals. It enabled buyers and sellers to
easily connect with their global counterparts.

Online matrimonial: In 1996, the first online matrimonial portal was launched in
India. A concept unique to India,1 online matrimonial portals transformed the
perception about the matchmaking process from “marriages are made in heaven”
to “marriages are made in cyber space.” Such portals have now evolved to cater to
various segments of the population such as NRIs, H1B visa holders, widows or
widowers, divorcees and other special groups.

2 Online recruitment: India’s online recruitment industry took shape in 1997.

The growth of the services sector, following the launch of economic reforms in
1991, resulted in the creation of additional jobs.

In this background, internet proved to be an efficient medium that allowed

employers and job seekers to connect. Prior to job portals, weekly government
magazines such as Employment News and newspaper notifications were the
primary means for employers and job seekers to interact.

3 Online classifieds gained quick popularity among users, as they did away with
concerns pertaining to physical delivery, logistics and taxation issues.

Although online businesses had begun to develop in the late 1990s, the
supporting ecosystem had not been put in place. The first wave of eCommerce in
India was characterized by low internet penetration, a small online shopping user
base, slow internet speed, low consumer acceptance.
Developments

In 1991 e-commerce became a hot choice amongst the commercial use of the
internet. At that time nobody would have even thought that the buying and selling
online or say “The online trading” will become a trend in the world and India will
also share a good proportion of this success.

India first came into interaction with the online E-Commerce via the IRCTC. The
government of India experimented online strategy to make it convenient for
public to book the train tickets. Hence, the government came forward with the
IRCTC Online Passenger Reservation System, which for the first time
encountered the online ticket booking from anywhere at any time. This was a
boon to the common man as now they don’t have to wait for long in line, no
issues for wastage of time during unavailability of the trains, no burden on the
ticket bookers and many more.

The advancements in the technology as the years passed on have been also seen in
the IRCTC Online system as now one can book tickets (tatkal, normal, etc.) on
one go, easy payments, can check the status of the ticket and availability of the
train as well. This is a big achievement in the history of India in the field of online
E-Commerce.

After the unpredicted success of the IRCTC, the online ticket booking system was
followed by the airlines (like AirDeccan, Indian Airlines, Spicejet, etc.). Airline
agency encouraged, web booking to save the commission given to agents and thus
in a way made a major population of the country to try E-Commerce for the first
time.
Today, the booking system is not just limited to the transportation rather hotel
bookings, bus booking etc. are being done using the websites like Makemytrip
and Yatra. The acceptance of the ecommerce on a large scale by the Indian people
influenced other business players also to try this technique and gain high profits.
Though online shopping has been present since the 2000 but it gained popularity
only with deep discount model of Flipkart. In a way it re-launched online
shopping in India. Soon other portals like Amazon, Flipkart, Jabong, etc. started
hunting India for their businesses.

years this field has been renovated to a high extent and hence fascinated many 7
India had an internet user base of about 354 million as of June 2015 and is
expected to cross 500 million in 2016. Despite being the second-largest user base
in world, only behind China (650 million, 48% of population), the penetration of
e-commerce is low compared to markets like the United States (266 million,
84%), or France (54 M, 81%), but is growing at an unprecedented rate, adding
around 6 million new entrants every month. E-commerce market is likely to grow
ten-fold in next five years i.e by 2020 to reach $100 billion on the back of
increasing penetration of internet, smartphones and spread of digital network in
rural areas.

country's e-commerce sector, which is around $10 billion (Rs 65,000 crore) at
present, can even touch $250 billion in next ten years. This boom will happen
because the broadband would take over. E-commerce market would be driven by
the local languages and broadband internet penetration into rural India. By 2017,
India will have 350 million smartphones and it will create demand. Meanwhile, e-
retailing and various other formats of retail such as direct selling could co-exist
and grow as there are several models growing in retail across the world. 500
million Indians are expected to connect to internet and it would create huge
consumer opportunity.
In India, cash on delivery is the most preferred payment method, accumulating
75% of the e-retail activities. Demand for international consumer products is
growing much faster than in-country supply from authorized distributors and e-
commerce offerings.

In 2015, the largest e-commerce companies in India were Flipkart, Snapdeal,

Amazon India, and Paytm.

About 70% of India's e-commerce market is travel related. There were 35 million
online shoppers in India in 2014 Q1 and is expected to cross 100 million mark by
end of year 2016. By 2020, India is expected to generate $100 billion online retail
8 revenue out of which $35 billion will be through fashion e-commerce. Online
apparel sales are set to grow four times in coming years.

Another big segment in e-commerce is mobile/DTH recharge with nearly 1

million transactions daily by operator websites.

Online transactions are not only restricted to online retail or travel anymore, with
the influx of mobile and ‘on-demand’ based businesses, customers are looking for
convenience and ease of access for products and services at all times. India is
witnessing a year on year growth of close to 40% in digital transactions.

Payment system providers are now offering ready-to-integrate development kits

for mobile app companies to deliver a native payment experience. Savvy
consumers are now even ditching their credit/debit cards when it comes to making
a purchase online, all thanks to wallet and banking apps which allow swift
checkout experience.

Another notable development that is happening with the onset of the wallet
adoption is the usage of these instruments beyond the digital space. Restaurants,
brick and mortar stores which depend upon PoS systems for payment collection
can also give wallet users an option to use the same instead of swiping their bank
cards, a part of online to offline commerce

Also, to keep up with the pace of the global economy, the Government too is
pushing out policies to encourage a movement towards a cashless society. This is
happening through various initiatives: Payment banks, Bharat Bill Payment
Services, proposal to do away with surcharge / convenience fees, etc.
1.c Online-to-Offline Model – Concept

O2O commerce refers to a general Online-to-Offline business model that utilizes

webbased markets and tools to attract the digital shopper to participate in in-
person retail consumption. Ultimately, O2O encompasses a whole industry with a
wide array of different techniques and services aimed at incorporating the digital
& physical marketplaces.

Online-to-offline commerce is a business strategy that draws potential customers

from online channels to physical stores. Online-to-offline commerce, or O2O,
identifies customers in the online space, such as through emails and internet
advertising, and then uses a variety of tools and approaches to entice the customer
to leave the online space. This type of strategy incorporates techniques used in
online marketing with those used in brick-and-mortar marketing.

The Online to Offline market is a growing and attractive segment. The reasons for
that are fairly straight forward. While online shoppers are just around 20 million,
there are a little over 200 million smartphones in the country. Changing consumer
behavior means that they demand instant gratification and aren't ready to wait.
That is where hyper local deals delivered through an app play a key role.

It is a win-win all around, claim merchants, marketplaces and users. The local
merchant can control stock and inventory, as well as whom they choose to sell to.
The buyer not only gets a lower price, but he also supports local economic
activity. The marketplace, of course, takes a cut in the entire process.

Retailers once fretted that they would not be able to compete with e-commerce
companies that sold goods online, especially in terms of price and selection.
Physical stores required high fixed costs (rent) and many employees to run the
stores, and because of limited space, they were unable to offer as wide a selection
of goods.Online retailers could offer a vast selection without having to pay for as
many personnel, and only needed access to shipping companies in order to sell
their goods.

Some companies that have both an online presence and an offline presence
(physical stores) treat the two different channels as complements rather than
competitors. The 10 goal of online-to-offline commerce is to create product and
service awareness online, allowing potential customers to research different
offerings and then visit the local brickand-mortar store to make a purchase.

Techniques that O2O commerce companies may employ include in-store pick up
of items purchased online, allowing items purchased online to be returned at a
physical store, and allowing customers to place orders online while at a physical
store.

The rise of online-to-offline commerce has not eliminated the advantages that
ecommerce companies have. Companies with brick-and-mortar stores will still
have customers that visit physical stores in order to see how an item fits or looks,
only to ultimately make the purchase online (referred to as “showrooming”). The
goal, therefore, is to attract a certain type of customer that is open to walking or
driving to a local store rather than wait for a package to arrive in the mail.
PAYTM ONLINE-TO-OFFLINE MODEL

Indian payment and mobile commerce firm Paytm, is on a mission to be the first
profitable company in the e-commerce segment. For this, it has charted out a
multi-pronged strategy that will lead to Paytm’s break-even sooner than the
expected 2017 target.

One of the key strategies that Paytm is trying to replicate from its Chinese parent
Alibaba is to involve the local merchants in the e-commerce and boost their sales
through what is widely known as O2O (online-to-offline) marketplace, a business
model that the Chinese e-commerce giant has been focusing since the last few
months. With this model, Paytm, in which Alibaba has a little over 25 per cent
stake, plans to take on bigger rivals such as Flipkart and Snapdeal in terms of both
GMV (total amount of transactions) and profitability.
Paytm - at a glance

• Paytm's offline merchant netwok includes small 'paan' shops, vegetable vendors
and big retail outlets such as Aditya Birla Group's food and grocery retail arm
More, Indian Oil petrol pumps, food chains such as Cafe Coffee Day and Pizza
Hut, and several schools and colleges.

• Paytm gives these merchants a sticker with a personalized code, which can be
put near the cash counter. Customers with Paytm accounts can then scan the code
from their mobile. The system asks how much to pay the merchant and the
amount is immediately transferred to the merchant.

• Currently, the Noida-based startup does 3.5 million offline transactions in a

month worth $8.5 million, excluding mobile recharges. It estimates transactions in
the offline business alone to grow 10 times to 35 million by the year end.

• Some of these offline merchants are being trained to also become cash collection
agents for its payments bank to acquire customers and recharge Paytm wallets. As
Paytm continues growth in tier 2-3 town, it wants to enable their unbanked and
underbank customers to enable them to add money to their Paytm wallets through
physical add cash points, bank network and ATM.

The company plans to have 3.5 lakh add points by the end of this year from
67,000 at present.
CHAPTER:

OBJECTIVES OF THE STUDY

The basic objective of the project is to understand what is Paytm O2O.
Understanding the target market and the approach behind the scheme.

Further the research is conducted over certain amount of target market to

determine the following:

1. How much awareness is present regarding paytm in the local markets?

2. The primary reason for which people use Paytm. Their motivation and
association regarding Paytm.

3. How many people are reluctant in using paytm and why? The research tried to
find out the reason of non-usage.

4. If paytm withdraws its cashbacks will the people who use paytm still continue
to use it or switch over?

5. Whether people are aware of the latest developments such as O2O and
Payments Bank being launched by paytm.

6. The level of acceptability shown by people to new models. Whether factors

like age, gender etc. impact their will to explore.

7. Out of a sample how many people could not get convinced to accept paytm as
a payment option and the reason for their denials.
CHAPTER:

COMPANY PROFILE
2.a Profile of the Organisation

Type of business: Private

Type of site: E-commerce

Founded: 2010

Headquarters: Noida, Uttar Pradesh, India

Founder(s): Vijay Shekhar Sharma

Key people: Vijay Shekhar Sharma (CEO)

Services: Online shopping, Payment system

Parent: One97

Website: paytm.com

Alexa rank: 351 (February 2017)

Current status: Online

2.b PROBLEMS TO PAYTM

PAYTM FACES MULTIPLE CHALLENGES AT A CRUCIAL

JUNCTURE OF ITS JOURNEY

Paytm, the mobile wallet and e-commerce start-up, became a household name in
the two months. So much so that it has become a generic term associated with any
e-wallet and has become an all-pervasive brand with high recall value.
Demonetization gave mobile wallet firms like Paytm helping them gain users at
exponential rates every day.

Since the demonetization drive was announced by Prime Minister Narendra Modi
on November 8, Paytm has added new users at unforeseen rates and its trading
volume grew up. But the brand has been facing some critical challenges in terms
of transaction. It is by overcoming these challenges that the digital wallet sector’s
market leader, Paytm, can stabilize its brand image and grow at a steady rate.

FOCUS ON ADVERTISING AT THE COST OF INFRASTRUCTURE

The leading e-wallet firm has been battling continued transaction problems.
Customers trying to load money onto their Paytm wallets have had money
deducted from their bank accounts but the credit had not reflected in their Paytm
wallets. Users also complained that efforts to transfer money back to their bank
accounts were also failing.
The technological backend of Paytm seems to have under high pressure. “When
demonetization was announced, Paytm could not have anticipated the 1000%
jump in users. What a technology company like Paytm should have done at that
point was focus on strengthening its backend and creating a platform, instead of
focusing on advertising,” said N Chandramouli.

The primary concern during this time has been the alleged non-responsiveness of
the Paytm customer care. Paytm users have been trying to reach out to Paytm via
Twitter to get their transaction related issues sorted. In return, Paytm has been
trying to draw the attention of its users to the various reasons why a transaction
might be failing and sharing Information on how to contact Paytm’s customer
care on Twitter and on the Paytm blog.

Paytm’s Twitter profile has been bombarded by messages from distressed uses
that are having problems making transactions via Paytm.

Paytm has been struggling to cater to its 170 million users, 20 million of whom
join between November 10 and December 20.

In addition, some days ago the Paytm app went missing from the iOS App Store
because a recent update of the app was buggy. Paytm sincerely regret the
inconvenience caused by this outage,” Paytm said on their blog.

SUSPECTED INSIDER FRAUD

Adding to this mix of unfortunate incidents, Paytm’s employees are now being
investigated by CBI sleuths for defrauding the company itself. It has been
reported that based on complaints from Paytm, two cases of fraud amounting to
nearly Rs 10 lakh have been registered against 22 private individuals. The police
suspect that insiders facilitated the fraud.

CONTROVERSIAL ADVERTISING STRATEGY

Many newspapers across India were splashed with a Paytm advertisement on the
morning of November 9th congratulating Prime Minister Modi for “taking the
boldest decision in the financial history of Independent India.” Opposition
political parties and politicians criticized Paytm for this advertisement from Delhi
Chief Minister Arvind Kejriwal and West Bengal Chief Minister Mamata
Banerjee, to RJD chief Lalu Prasad Yadav, nobody spared Paytm.

They dragged Paytm into a political war. “In the case of the newspaper
advertisement and the comments made by the Opposition the brand tends to get
colored - not a secular color but a party color. It is possible that some would stay
away from the app because of this party connection but that may not be too large
a section of the public,” said Bijoor.

Another advertisement from Paytm also faced criticism and this time Patym was
pressured into withdrawing the advertisement and changing the advertisement.
The digital advertisement ‘Drama Bandh Karo…Paytm Karo’ was seen to be
mocking the Situation and wasn’t appreciated by viewers.
CHAPTER:

S.W.O.T. ANALYSIS OF PAYTM

STRENGTH:-

The biggest strength of Paytm it has ties ups with various national banks and with
RBI for Debit and credit cards. Ever since it started online mobile recharges
Paytm pamphlets and acceptance boards and notices can be witnessed even on
road side tea stall and pan shops.

Paytm works with all mobile operators in all states in India for prepaid mobile
DTH & data card recharges and prepaid mobile land line & data card bill
payment. It partners with the multiple national banks for credit card, debit card
and net banking payments. Paytm also works with various billers for utility bill
payments.

Keeping in mind the mobile world paytm mobile application is compatible with
all possible platforms including android, IOS & windows.

WEAKNESS:-

Paytm has grown into something that offers a lot of functionalities in areas other
than its chief purpose i.e., recharge. This makes the app bulky and takes up lot of
space. Processing takes time and finally fails to recharge. No replies on mails
from customers. Huge traffic during festive seasons when new offers are
introduced. Since Paytm is a mobile commerce, obviously it requires smart phone
users.
OPPORTUNITIES:-

The biggest opportunity that is witnessed in the present day for Paytm or any
other online business is the act of Demonetization announced by PM Mr.
Narendar Modi and replacement of paper currency with plastic currency leading
India to 100% digital marketing. And encashing upon this since the
announcement of demonetization reports are Paytm has made a business of 1.28
crore in a single day and have added 40,000.

THREATS:-

The major threat that comes to the Paytm business is from other online portals i.e.
Snapdeal, Amazon, Flipkart and many more such online portals which provide
thousands of products under different categories from varied suppliers.
CHAPTER:

MARKET PLAN
STRATEGY OF PAYTM

The overall up-to-down 360 degree campaign made sure that all their offers reach
out to its targeted audience on social media too. Sharing their advertisement on
Facebook and Twitter, and even sponsored posts on Instagram and at time even
Snapchat.

However, the most effective of all strategies was the #PaytmKaro. It was being
added to almost every conversation that is being driven on Facebook and Twitter.
All the feedbacks, complaints (if any), comments etc started excessive use of this
#PaytmKaro .It’s observed that the advertisement rolls out some life situations
such as money transfer, online shopping, mobile recharge, paying at petrol pump
etc, which is made easy by Paytm services. This TV commercial that rides the
emotional route to connect with Indian mobile customers, has gained over 50K
views on YouTube.

#PaytmKaro had no digital campaign budget initially. TV was the primary

medium for the campaign and that is understood with the campaign.

With an objective of making Paytm a household name when it comes to mobile

money transfer, it was really surprising that why the brand had ignored the social
media savvy audience. But lately they realized its importance and grabbed the
opportunity.

The brand planned to run a social media campaign and even succeeded in it. Also
at a later stage it can obviously drive meaningful conversations with fans around
#PaytmKaro.
Bargain power which is currently not available at any other marketplace and
Paytm has made the selling and buying experience a lot more interesting.

Paytm had recently collaborated with IRCTC to make Paytm wallet payments as
one of the online payment options while booking a train ticket. According to the
annual reports of IRCTC, they process around 180 million transactions every
year.
PRESENT STRATEGY AND FUTURE PROJECTS

In 2015 Paytm received a license from RBI for starting India's first payments
bank. The bank intends to use Paytm’s existing user base for offering new
services, including debit cards, savings accounts, online banking and transfers, to
enable a cashless economy. The payments bank would be a separate entity in
which the founder Vijay Shekhar Sharma will hold 51%, One97 Communications
will hold 39% and 10% will be held by a subsidiary of One97 and Sharma.

With 120 million wallets, India’s largest mobile wallet company Paytm boasts of
a user base that is six times the number of credit card users in the country. Paytm
wants to be present everywhere the consumer is transacting and own the entire
life cycle of pay, shop and save. The company also runs an online marketplace
where over 100,000 merchants sell their goods. But unlike other e-commerce
players, Paytm does not have its own fulfilment centers or inventory. About 50%
of the company’s e-commerce sales come from tier 3 and 4 towns and there are
many sellers who are waiting to take their business online. Paytm is looking to
host about 500,000 merchants on its platform by end-2016.

Of its current gross merchandise volume (GMV) of $4 billion, sales from the
marketplace account for about 50%. The company hopes to clock a GMV of $10
billion by the end of the year, with e-commerce contributing roughly the same
percentage. Helping it achieve that number will be the next two parts of Paytm’s
overall strategy — a bigger offline merchant network and payments banks.

In November 2014, the company started giving its offline presence a big push: it
gave its merchants a sticker with a personalized QR code, which was put up near
the cash counter. Customers with Paytm accounts could then scan the code using
their smartphones and the amount to be paid would be transferred from their
wallets to the merchant’s.

The company is currently clocking 3.5 million offline transactions per month,
with its network now including small kirana and paan shops, auto drivers,
vegetable vendors and bigger retail outlets such as Aditya Birla Group’s food and
grocery arm More, Indian Oil petrol pumps and food chains such as Barista, Costa
Coffee, KFC and Pizza Hut, apart from the Delhi Metro and several schools and
colleges.

The company is working on various models that will enable customers to pay
offline, including QR codes, one-time passwords and even sound-based payments
systems at 23 toll gates. There are only 1.3 million points of sale (PoS) terminals,
limiting the use of digital payments, and Paytm wants to overcome this by
targeting nearly two to three times this figure by the end of the year. The company
does not charge its offline merchants by transaction and instead hopes to build
enough use cases for them to spend on the Paytm network instead of taking
money out of the system. Customers could then pay utility bills, make phone
recharges, buy train tickets, shop, pay school fees and even top up other Paytm
wallets.

Cashbacks form an important part of the strategy the company uses to encourage
customers to make repeat transactions. Paytm spent around Rs.600 crore on
cashbacks in the past year alone and is looking to rationalize cashbacks this year.
The final part of its strategy will be the launch of its payments bank later this
year.

Paytm is also approved as an operating unit for Bharat Bill Payment System, as a
result of which users can pay their bills anytime and anywhere.
Paytm plans to launch a series of new products, including insurance, wealth
management services and loans through its new payment bank that aims to open
for business in August.

Paytm, is working on a plan to introduce insurance cover for bus passengers

against a range of risks, such as accidents, missed travel, cancellation of ticket and
loss of baggage. The passenger would be given an option to choose the insurance
cover and the premium would be bundled with the bus fare, as in the case of
domestic air travel. Around 30,000 tickets are booked daily on Paytm's platform.
The average fare is Rs.500.The travel insurance business in India is worth Rs.400-
500 crore and the cover is mostly taken by those who travel abroad. While the
government is talking to insurance companies to introduce personal accident and
baggage loss cover to railway passengers, the bus travel segment is yet to open up
to the idea.

Amongst other services, the bank will offer customers the option to invest as
little as Rs.1 in a money market fund, buy daily insurance to underwrite movie
tickets or buy travel tickets at nominal costs. At the backend there will be tie-ups
with other banks and 24 financial institutions.

The bank will retain the Paytm brand name and identity when it is launched after
receiving, final regulatory approval. Last year, the Reserve Bank of India granted
"in-principle" approvals to 11 applicants including Paytm, Reliance Industries,
Bharti Airtel BSE - 1.67 %, and Vodafone among others to set up payment banks.
These ventures can accept deposits, convey remittances and dispense payments
and financial services with a focus on the unbanked segments including migrant
workers. They cannot lend to their customers, though.

There is a high level of dormancy in the bank accounts of lower-income group, as

traditional banks treat these as additions and not the "core" of their portfolio.
CHAPTER:

FEASABILITY STUDY
products and services

Paytm is widely recognized as an online recharge and bill payments portal. It

offers a wide range of services which are not just constrained to bills and mobile
recharge. Apart from the services paytm is also an e commerce portal and offers a
variety of products in different categories.
List of key personnel in paytm.com
Revenue Model of Paytm

A revenue model is a framework for generating revenues. It identifies which

revenue source to pursue, what value to offer, how to price the value, and who
pays for the value. Paytm is a sales channel for businesses willing to sell their
products online. It believes in a marketplace model i.e. a secure transactional
website where selected suppliers can sell their products or services to buyers.
Paytm is the provider of online Marketplace Service, where vendors register their
products and buyers come to buy. Paytm earns its revenue in the form of
commission from the seller.

Through escrow account paytm receives interest, when buyer pay for their
purchase that amount is held by paytm until the customer does not confirm it. If
customer does not confirm in next 7 days paytm expects that the buyer is satisfied
with the product and they transfer the money to the seller’s account.

Paytm also earns by advertising other products on websites like Haldiram, pvr,
sherkhan, Uber, MakeMyTrip, BookMyShow & many more Patym charges
annual subscription fees to the sellers who list their products on website. Under
advertising revenue model paytm allows sellers to show their advertisement on
paytm website and charges some amount for this advertisement.

In subscription model paytm allows different seller to list their products on their
website and paytm charges some annual subscription fees from these sellers.
Which generates revenue under advance payment model paytm received the
interest on the payment of customer until they do not transfer the money in the
seller account.
Indirect source they earn revenue: - Any value in your Paytm Wallet which is not
utilized in the aforesaid manner may stand forfeited at the discretion of Paytm.
Paytm reserves the right to forfeit the amount post adherence to the following
communication process: – Paytm will send 15 days advance communication to
Customers for outstanding amount in Paytm Wallet by SMS at the mobile number
on which Services have been activated.
Value Chain of Paytm

A value chain is a set of activities that a firm operating in a specific industry

performs in order to deliver a valuable product for the market. A value chain is a
business term describing the full range of iterative activities a company uses to
create a product or a service. The purpose of value-chain analysis is to increase
production efficiency so that a company can deliver maximum value for the least
possible cost.
Primary Activities:

1. Inbound Logistics- Inbound Logistics include transferring materials from the

supplier to the manufacturer. In the point of view of Paytm, inbound logistics
includes activities like receiving, storing and disseminating the input of products.
Paytm has outsourced most of its inbound logistics activities.

2. Operations- Operations are the activities which transform raw materials into
finished product. From Paytm perspective, it can include converting
consumer data to serve advertisements.

3. Outbound Logistics- Outbound logistics is the channel by which the final

product is distributed to the consumers. The final product of Paytm is made
available through the Paytm app.

4. Marketing and Sales- Marketing and sales activities of Paytm include –

marketing, sales force management, advertising and promotion, channel selection,
pricing etc.
Support Activities:

1. Firm infrastructure- Firm infrastructural activities which support Paytm include

finance, legal services, quality management, planning and general management.

2. Human Resource Management- HRM activities including hiring, training,

compensation and development of human resource of a firm.

3. Technology Development: Paytm uses different technologies to support

their activities. They use methods like Zendesk, Google forms for customer
support. For product and design, software like Google fonts and balsamic are
used. SendGrid, AppsFlyer are used for marketing.

4. Procurement: Procurement refers to the function of purchasing inputs used in

the firm’s value chain, not the purchased inputs themselves.
CHAPTER:

FINDINGS
The findings of this research are as follows:

1. Maximum number of people associate paytm with mobile recharges or

cashbacks.

2. Women are more rigid when it comes to accepting new technological changes.

3. The age of the respondent does not effects their getting enrolled with paytm.
People between the age bar of 20-50 are more likely to get enrolled if they have
been convinced properly and realize some advantage.

4. There is no relationship between the age of a respondent and their reason to

decline to be a part of O2O. The age cannot be considered as a factor affecting
the. There are other factors such as lack of trust on online services and companies,
bad experience or bad reviews about the company in the social circle, online
mode calls for money being converted into white etc.

5. A respondent using paytm daily is not majorly affected by cashback.

Cashbacks alone cannot be considered as a factor affecting/motivating consumers
to use paytm on a daily basis.
CHAPTER:

LIMITATIONS
 This is very difficult to collect the data from the firm what strategy they
are using to overcome the recession economic condition because different
company using the different strategy and also its very confidential for the
company so the company don't want to flash their marketing policy or
strategy.
 People of rural areas are not aware of the company because of no
promotional activities undertaken by the company.
 People are reluctant to use paytm as they think it’s a gamble.

 Sometimes the database is not provided then it becomes difficult contact

to people as our work is mostly through telephonic conversation.
CHAPTER:

CONCLUSION
Paytm is an e-commerce company majorly recognized for its mobile recharge and
bill payment services but a very less percentage of people is aware about the other
services being offered by paytm. Paytm is up with few highly ambitious plans
such as payments bank, insurance etc for future the preparations of which has
already begun and an effort t making india a cash-less market has already been
started by paytm in the form of O2O in order to spread awareness and give rise to
cash counters that can work as points where customer can pay cash and get instant
paytm cash on the go in seconds or vice-versa in case of dire need.

The problem facing this plan is the lack of awareness in people regarding paytm;
its schemes and its working model. Many people hold grave misconceptions about
the company as they fail to understand how the company is being able to thrive
after offering cashbacks at such huge rate. In order to build a strong customer
base paytm needs to build up trust among people by being transparent and making
itself more visible and transparent. Paytm must take in notice certain points which
were prominently noticed after talking to a few people in Delhi markets.

1. It must advertise more and must focus on word of mouth publicity. It is both a
constructive mean as well as a destructive tool if not used properly. India is an
emotional and sentimental country paytm needs not only target the indian
mentality of “we accept whatever comes free” rather it should try to get attached
to the country’s sentiments if it wants to plant itself in india.

2. Special focus is needed on the customer needs and after sales services i.e. the
ease and comfort of consumer must be a priority so that the consumer feels
connected and can trust the company.

3. Cashbacks on some regular categories must be more or less constant because

the cashbacks which keep on appearing today and vanishing the next day effects
the low- income group customer a lot they do not appreciate complexity as they
fail to understand it and paytm is wanting to target the lower vertical so it has to
be user friendly by all means.

4. Paytm needs a series of survey to understand the needs of the customer their
fears and reason of latching out the techno- base brands and later on cater to all
those nreeds to get an upper edge over competitors.
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