Paytm's Latest Moves in Travel - India Report

18.07.2024 - 11:57 / skift.com / Bulbul Dhawan

Paytm started as a financial services company in India, but is now diversifying its revenue streams, with a special focus on travel. The fintech company often refers to itself as an online travel agency and is looking at travel as a core business segment.

In the latest move to enhance its travel offerings, Paytm has entered into a strategic partnership with German intercity bus services company FlixBus, which entered India in February this year.  

Becoming an OTA? Officially, Paytm is still a “mobile payments and financial services distribution company,” with a mission to bring 500 million Indians to the mainstream economy using technology.

However, after its payments bank (which overlooked the payments wallet, customer accounts, and fixed deposits) was closed earlier this year by India’s central bank, the Reserve Bank of India, the fintech player has been looking at alternative sources of revenue, with travel being one of them.

On the Paytm’s website, Paytm Travel is the first segment to appear, letting customers book flight, bus, or train tickets.

Paytm’s chief business officer Vikash Jalan stressed travel in his statement on the partnership with FlixBus: “As a leading travel aggregator, we are committed to enhancing the overall travel experience in India. Our partnership with FlixBus marks a significant step forward in this mission, directly aligning with our core business objectives to drive growth in the travel sector.”

Last month, Paytm announced its partnership with travel aggregators Skyscanner, Google Flights, and Wego. The move had followed a 19% annual increase in flight bookings on Paytm in the January-March quarter this year.

It recently added features such as guaranteed seat assistance to its train booking segment, and partnered with Samsung to offer flight and bus ticket bookings through Samsung wallet. 

Its travel division has also brought on board three new airlines to its selection – Cambodia Angkor Air, SalamAir, and FlyDubai.

Importance of Paytm: Paytm played a crucial role in India’s digital economy, especially after the demonetization in November 2016, in which the Indian government discontinued the INR 500 and 1,000 cash notes to curb the issue of counterfeit currency. The move led to a boost in digital payments in India and Paytm got the first mover’s advantage in QR-based mobile payments using its payment wallet.

Paytm’s user base increased from about 140 million in October 2016 to 270 million a year later, reaching more remote parts of the country. 

This user base of smaller towns in India makes Paytm a crucial player, giving it a slight advantage over other OTAs. 

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