Paytm has added UPI and IMPS as payment options to add money to the wallet. India's biggest e-wallet company announced this late last evening. While UPI is available both on the app and website, IMPS is available only on the website at the moment.
Both UPI (United Payment Interface) and IMPS (Immediate Payment Service) are mobile based payment systems that enable transfer of money in real time.
The company also said in a blog that it will levy a 2 percent charge when money is added to the wallet through credit cards. Paytm said that the reason behind the move was to curb the misuse of the 0 percent fee on bank transfers.
"This 0 % transfer to bank fee left an opportunity to misuse this great service meant for our valuable customers. We saw a disturbing trend when many users started funding their Paytm wallet with their credit cards and transferring it to the bank all for free. They were not only getting free loyalty points which effectively is free cash but also getting access to free credit," the blog stated.
Paytm said that many customers were taking undue advantage of the zero-percent fee to transfer money to their bank accounts directly in order to earn benefits from the company and the bank. The e-wallet startup added that, on every credit-card transaction, the company has to pay a fee to the credit card company and if that money is not spent through Paytm it incurs a loss.
"Some financially savvy users (surprisingly many of them employees of national financial institutions) exploited this model to rotate money. This may surprise normal users like most of us but for a savvy user it meant freebies at Paytm's cost," the statement said.
However, Paytm added that because it is committed to the 0 percent charge on adding money to the wallet, from now on it will return the 2 percent fee to the customer in the form of a cashback coupon. The user will be able to make payments on the Paytm network through the coupon code.
Paytm has also added Jio as one of the telecoms in the recharge section of the website. The users will be able to get different plans and add-ons of the Reliance-owned company through the e-wallet service.
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