Paytm Chief Vijay Shekhar Urges PLI Scheme for Payment Devices
Paytm, the fintech company operated by One97 Communications, is urging the Indian government to include payment segment devices in the production-linked incentive (PLI) scheme. The company’s founder and CEO, Vijay Shekhar Sharma, highlighted the importance of boosting local production to create more job opportunities and reduce dependence on imports.
Despite the higher taxes on locally produced soundbox devices compared to imported ones, Paytm has taken the initiative to manufacture these devices in India. Sharma emphasized that it is essential for India to shift towards manufacturing, as the country is currently dominated by the services sector.
The PLI scheme, introduced by the Indian government, aims to promote domestic manufacturing in various sectors by providing financial incentives to eligible companies. By including payment segment devices in this scheme, the government can encourage more companies to invest in local production, which would not only enhance job creation but also contribute to the growth of the domestic manufacturing ecosystem.
Paytm’s push for local production aligns with the government’s vision of promoting the “Make in India” initiative and building a self-reliant and resilient economy. The fintech company’s efforts to manufacture soundbox devices domestically despite the challenges of higher taxes on local production reflect its commitment to supporting the country’s economic goals.
Vijay Shekhar Sharma, the founder and CEO of Paytm, expressed his concern that relying on importing devices from China while making software in India is depriving the country of fully harnessing the advantages of technology. Sharma emphasized the need for India to focus on domestic manufacturing of technology products to ensure the nation benefits comprehensively from the technological advancements.
By manufacturing devices locally, India can create a robust technology ecosystem that fosters innovation, job creation, and economic growth. It would reduce the dependency on imports, strengthen the country’s technological self-reliance, and enhance its position as a global technology hub.
Moreover, local production can also lead to improvements in the overall quality and affordability of products, making them more accessible to a larger segment of the population. It can also contribute to reducing the trade deficit and boosting the economy through increased exports of domestically produced technology goods.
Sharma’s call for bringing payment segment devices under the production-linked incentive scheme is aligned with the government’s efforts to promote domestic manufacturing and the “Make in India” initiative. By incentivizing local production, the government can encourage more companies to invest in manufacturing in India, leading to technological advancements, employment opportunities, and overall economic progress.
Paytm founder and CEO, Vijay Shekhar Sharma, emphasized that the company’s soundboxes are now completely made in India through the process of indigenization. However, he expressed concerns about the disparity in duties between imported soundboxes and domestically produced ones. Currently, when soundboxes are imported, they are not subject to certain duties, while Indian manufacturers like Paytm have to bear the burden of paying these duties. Sharma called upon the government to consider implementing a Production-Linked Incentive (PLI) scheme specifically for payment equipment, which would provide incentives for local production and level the playing field for Indian manufacturers.
The PLI scheme is a government initiative designed to boost domestic manufacturing in India. By offering financial incentives to companies that produce goods locally, the scheme aims to enhance the country’s manufacturing capabilities, create job opportunities, and promote technological advancements. Sharma’s request for the inclusion of payment equipment in the PLI scheme reflects Paytm’s commitment to promoting indigenization and contributing to the growth of the Indian manufacturing sector.
In line with its commitment to support merchants, Paytm launched two new models of soundboxes – the Paytm Pocket Soundbox and Paytm Music Soundbox. These soundboxes are designed to provide merchants with easy and efficient solutions for digital payment acceptance and music streaming, enhancing their overall business operations.
The Paytm Soundbox serves as a useful tool for merchants, providing them with payment alerts when they receive money. With the introduction of the new Music Soundbox, merchants will now have the additional benefit of being able to connect their phones to the device and enjoy music. By offering both payment alerts and music streaming in one device, Paytm aims to enhance the overall merchant experience and further incentivize the adoption of its soundboxes.
The company has ambitious plans for the widespread adoption of soundboxes across the country. Amit Gupta, the Vice President of Paytm, envisions that around 4-5 crore (40-50 million) soundboxes will be installed within the next 3-5 years in India. This projection showcases Paytm’s confidence in the potential of its soundbox devices and the demand for such innovations among merchants.
As of June 30, 2023, Paytm has already established a substantial merchant base, with over 79 lakh (7.9 million) merchants subscribing to its payment devices, including soundboxes and card machines. This significant subscription base reflects the popularity and trust that merchants have placed in Paytm’s products and services for their payment needs.
By providing merchants with innovative solutions like the Soundbox and Music Soundbox, Paytm aims to empower businesses, enhance customer experiences, and promote digital transactions. With its focus on local production and advocacy for the inclusion of payment equipment in the PLI scheme, Paytm continues to play a crucial role in shaping India’s digital payment ecosystem and driving the country towards a more cashless and digitally empowered future.
