How does paytm earn money (2021) | Business model & history

This question must also have come in your mind that how does Paytm earn money? What is the business model of Paytm? And how paytm become a company? First we tell about history of paytm and Vijay shekher Sharma and after that we tell about business model of paytm or how does paytm earns money

How paytm become a company

Paytm full form is pay through mobile. Paytm founder is Vijay Shekhar Sharma. Vijay Shekhar Sharma was born on 1973 in Aligarh, Uttar Pradesh. He was Intelligent, he got admission in engineering college Delhi through special permission at the age of 15 year old.

He (Vijay ) was from Hindi medium so he got lot of difficulty in understanding the lecture of the professor. His classmates also used to fun at him, so in the collage he spend most of his time to reading English books and success stories in the library.

After reading the success story, he understand that if he wants to do something big in life, then he will become the boss of his life himself. So he starts learn coding from a computer class in college. After some time Vijay and his friends develope a site together called Indiasite.net which was basically a search engine.

2 years later, an American company buys their website. After this, Vijay worked on many projects and after 1 year Vijay collects the money to open his own company and in the year 2000 he starts a company called one97.

One97 company was provide people search engine facility, means if someone wanted to know who was calling them, then he send that number to One97 company and the company would send the details of the number owner.

But Vijay’s savings started short to run One97 company. Vijay was take a loan from the bank to increase the growth of One97. he had take loan on 24% interest several times. One97 income used to go towards paying bank interest, employee salary and house rent. His financial situation was getting worse. Sometimes they had spend the night by drinking tea because of no money for dinner.

He had work as a consultant and trainer to arrange the money to run the company. While working for the consultancy, he meets Piyush Aggarwal. Piyush Aggarwal needed Vijay to develop the company’s software. After Vijay’s development, Piyush’s income was doubled.


Mr. Aggarwal was impressed by the Vijay’s work. He gave offer to Vijay to become CEO of the company, but Vijay was say that he has his own company and he wants go to good position by doing anything.

Finally, he accepts Mr. Agrawal’s proposal. But one condition was that he will take care of Mr. Agarwal’s company for half day and take care of his company the rest of the time, and for this he will have to pay 30,000 salary a month.

Piyush Aggarwal agrees with his proposal. Vijay’s work also liked by Mr. Aggarwal. Due to increasing daily interest of the bank, The bank had a lot of credit on Vijay. Vijay tell Piyush Aggarwal about this. After that Piyush Aggarwal buys 40% shares of Vijay’s company himself.

Vijay Sharma notices that smartphone user are increasing day by day. So he wanted to do something inside the smartphone that people could easily financial transactions through phones. According to the plane, a site named paytm.com was launched on 8 July 2010. And within a few days One97 company launched Paytm app. According to wikipedia paytm revenue was ₹3,629crore (US$510  miliaon.

How does paytm earn money

Initially Paytm was started only with the facility of online recharge and DTH recharge, but within a few days due to the facility of electricity bill, gas, bus tickets etc. People started to like it and within 3 years, Paytm has 250 million valet users.

After this, Paytm entered into the world of e-commerce by offering a facility like Flipkart, Amazon and after that paytm started Paytm Payments Bank. And today Paytm has become successful that any small shop It is being accepted everywhere from big fonds to mall.

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How does paytm earn money

Paytm earn money from many way but today we tell about 4 unique and intelligent revenue model of paytm. Payment earns money through its wallet, payment gateway, recharge commission, data analysis, banking, etc.

Paytm Wallet

firstly tell about Paytm Wallet. How does Paytm benefit from maintain money in the wallet? When you store money in Paytm wallet, then Paytm does not give you any interest. Paytm save that money in his partner bank which through Paytm gets 4-5% interest.

In this way, Paytm earns interest on the money of millions of people. This is the first business model of Paytm. So paytm says to store money in its wallet.

Payment gateway of paytm

Payment Gateway means when you shop on a website and pay with your credit card or debit card, it is called a payment gateway.

Paytm Payment gateways charge between 1-2%. Similarly, Paytm earns 1-2% from the site where accepted paytm. Paytm earns money through payment gateway for every transaction.

The commission

Initially Paytm used to focus on recharge. Paytm gets commission on every recharge, Bill, Air ticket, train ticket, DTH recharge, Mobile recharge etc. Payment earns money from recharge commission.

Data analysis

If Paytm puts its payment gateway on thousands of websites, then Paytm knows which items are selling more, which product runs of which company, all know Paytm.

When you scan the QR code at a restaurant and make a payment, then Paytm knows which restaurant is getting more sales. Paytm has all the data of which locality the restaurant is running, how much discount people book flights, where more hotels are booked. The most important data among them is that Paytm knows from its payment gateway which product is selling more and which is not.

Therefore, Paytm knows that we have to tide up with which company tomorrow, which will increase our transactions or which new business we have to go. Paytm has all this data and that is why it is spreading in every service using this data

He is competing with Amazon Flipkart from Paytm Mall. It is trying to provide a lot of financial service with paytm money and many features connecting to exiting business.

Paytm has also picked up with a lot of traditional business. Paytm is accepted at the smallest tea shop or grocery store.
Data for every level of business is with Paytm and no online business has it.

Perhaps no good startup understands the business economy of India as well as Paytm. I hope you have know that how does paytm earn money

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