How Paytm Makes Money? [Everything You Need To Know]

How Paytm Makes Money

Hey guys! I’m sure a lot of people in today’s internet era use Paytm to some extent, in their day to day lives – especially the youth. But most people do not understand one particular question – a commonly Googled question, in fact- that is, as to how Paytm makes money itself?

Like how can they afford to offer unheard exorbitant discounts and cashback to their customers (old and new) routinely and that too, on a variety of products or services and still be profitable?

Do you wonder about the same? Well, you’re in luck! Today, we’re going to discuss in depth the various ways as to how Paytm makes money!!!

But first, let us refresh some of the known facts about Paytm:


An expansive digital monetary space for India, like never before

Paytm, is one of the largest online payment platforms in India and provides a whole range of services for its users, including its e-wallet which can boast to be the most preferred e-wallet among the Indian public.

Its user base is a staggering 350 million (as of the financial year 2019) and is nearing it’s 10th anniversary as it was launched in August 2010.

Its headquarters are located in Noida, Uttar Pradesh. Meanwhile, their marketing slogan of #PaytmKaro can be a whole different case study. With a valuation of approximately 16 billion dollars (as of January 2020); it’s one of the most important success stories to emerge out of India.

Services provided and how Paytm makes money from them

We’re now proceeding to discuss this topic extensively via eight solid methods and will explain the specific route of making money by Paytm. Let’s begin.

1. Bill payments

Paytm as a platform gives its users the comfort of paying their everyday bills from one simple platform and from their own homes; rather than going to ten different offices in different parts of the city.

Common bill payments include electricity bills, water, gas, broadband, insurance, school fees, etc.

How Paytm makes money?

Paytm actually charges money from the service providers themselves. They’re charging fees for providing a platform to them and acting as a middleman.

2. Paytm Wallet

One of the first e-currency platforms to emerge in India was Paytm Wallet. It stores your money digitally and the money is safe to be kept there. The Paytm digital currency is approved by our central bank of India which is the Reserve Bank of India (RBI).

If you weren’t aware, this is where your cashback is sent back as well. And once you’ve done your KYC; it’s very easy to store more than everyday money on it and enjoy cashless currency with no need to carry cash.

How Paytm makes money?

Like any other bank does honestly. It takes your deposited money and then, deposits it in an escrow account in another bank. They gain interest money from this deposit.

The expense of hosting a Wallet is offset by the higher gains of such interests on the deposits, thus, resulting in a profit.

3. Gold (Digital)

If you have only like 1% idea about investments or money handling; the one thing any parent or anyone who knows his stuff will tell you is that Gold is one of the most important investments in India (because of its safety). Why is it safe? Because unlike physical money which loses value over time due to inflation; gold’s value actually increases with time and can be liquidated very easily in times of need at the current rate.

Paytm offers to buy, sell, and store Gold electronically on their platform/app. One can also (after paying a low delivery fee) get the hold delivered to them. The medium of earning money is similar as before.

4. PayTM Mall/Marketplace

This is another exciting feature of Paytm which I’m sure most of you are already familiar with. Rival to giants like Flipkart and Amazon, Paytm Mall is a marketplace where customers can buy a wide range of products using Paytm Wallet itself. So, that cashback you got; can be used now to buy other products.

How Paytm makes money?

It is a three fold mechanism:-

Marketplace commission

A part of the selling price is retained by Paytm as commission for providing the platform to connect the buyer with the seller (i.e. serving as a middleman).

The rate charges vary from product to product and seller to seller.

Logistics charges

Paytm states these charges as “charges for using services of Paytm Mall logistics partners”.

Payment Gateway charges

2.7% is charged off the selling price of the product.

In addition, this is also accompanied by a penalty in case of fraud (which again; depends from case to case).

5. Payment Solutions

This option is relevant for the vendors or shop owners seeking online payment options to offer to their customers, who prefer to pay online.

Some of the common smart payment solutions offered by Paytm include:

SMS and/or WhatsApp link sharing

By tapping on this link, you’ll arrive at the payment page.

Embedding link on your blog/website

Have a blog? or a website? Which you’re using to sell something and want to offer Paytm as a mode of payment as well? Paytm provides this option to embed the icon on your website with the clickable link “Pay with Paytm” which your customers can use with ease.

How Paytm makes money?

Paytm actually charges zero fees for the set up of the same. But it does charge 1.99% off every transaction made through it. So, if you buy a phone worth 10,000/- through it; Paytm will receive an approximate Rs 200/- for it.

6. Mobile Recharges/other subscriptions

Mobile recharges were one of the primary services at the heart of the service when it was launched.

You could avail the comfort of online recharge sitting at home and not going to the office of your network provider to pay your dues.

Apart from mobile recharges, you can opt for data boosts, tv subscriptions, and other subscriptions or recharges.

How Paytm makes money?

Money is being charged from the mobile/other operators who are providing the service and not from the customers themselves.

This is maybe why companies like Reliance Jio want their customers to use their JioMoney wallet for recharge purposes; and let go of the middleman i.e. Paytm.

7. Paytm Bank

Paytm Bank is one of the most recent innovations being added by Paytm.

At present, they can’t offer loans to customers, but they can accept money as deposits and offer interest on it. Like traditional banks, debit cards are also issued.

How Paytm makes money?


It involves selling the products and customers of partner institutions and banks and for this, Paytm receives a part of it.

Interest on deposits

It’s like we discussed before. The Paytm money is deposited in some other bank by them and the interest received from such deposits (being greater than the interest paid out to customers) turns into a handy profit.

8. Other revenue streams

Paytm has lately begun providing services like “PAYTM First” (provides loads of benefits with partner service providers for a certain subscription amount) and Mutual Funds through the “Paytm Money” app. These are the areas where Paytm has targeted to expand their brand in areas other than the ones; which are considered traditional and dive into new markets! The scope of expansion and increasing revenue manyfold is huge here.


In the end, we’d like to say that Paytm is a wonderful success story for any corporate looking for inspiration; and from a customer point of view, it has certainly made life easier for many; by providing an alternate safe and secure method of payment. This has helped small businesses and other vendors too.

While there has been an aura of mystery around how Paytm makes money itself; while providing so many services at such cost-effective rates or charging seemingly minimal fees for the same. But hopefully today, the mystery is finally decoded and was helpful to you all.

For more such informative articles, keep coming back to our website and let us know in the comments how much of it was brand new information to you!

Until next time, this is goodbye.

How can I earn money in Paytm?

You can earn money in Paytm by sharing the referral code on social media, taking up surveys, watching videos, and completing other tasks.

What is the revenue of Paytm?

The revenue of Paytm is 3,629 crore INR.

Is Paytm listed in NSE?

No, it is not listed on any stock exchange.

Who is the current owner of Paytm?

One97 Communications Ltd. is the current owner of Paytm.