Paytm IPO

Strengths

• First-mover advantage: In India, this online payments provider was the first of its kind. Moreover, its time of establishment was ideal as during the same time smartphones were becoming more and more popular in the country.
• Focus on users’ convenience: One of the most crucial factors that have boosted the popularity of Paytm is its focus on convenience. This platform is operational 24/7. Thus, users can make payments via the app from anywhere at their convenience.
• Collaboration with merchants: Paytm has more than 20 million registered merchants, and this number is surging each day. This makes its digital platform a favourable option for consumers. The lucid interface of the Paytm App makes it possible for users to operate and make payments through it conveniently.
• Lucrative offers: This company has attracted a lot of interest from consumers owing to its lucrative offers. These benefits are designed specifically, keeping in mind the perspective of Indian consumers. Accordingly, these offers have played a crucial role in Paytm’s revenue generation.
• Portfolio of services: As mentioned earlier, this fintech company offers a wide range of services which includes online bill payment, online reservation facilities, etc. It also allows individuals to invest in digital gold and mutual funds. Consumers can make purchases from the Paytm mall. Thus, most of the things that an individual may want to do online can be done through this company’s digital platform.

Weaknesses 

• Users lack awareness: A large number of registered users of the Paytm App are not aware of all features of the platform. Their lack of knowledge regarding technology tools combined with the fear of fraudulent transactions has a direct impact on this company’s performance.
• Fear of going digital: Most Indians are yet to embrace the Digital India initiative. There’s still a lot of scepticism when it comes to cashless transactions. However, with time, one can expect to see a surge in non-cash payments.
• IT infrastructure: There needs to be appropriate bandwidth and speed for the Paytm App to function properly. Although it is not a problem for Tier 1 cities in India, the same might not be the case in remote areas or some locations in Tier 2 cities.

Opportunities 

• Increasing demand for payment aggregators: With the increasing reliance on technology, it appears that more people prefer online transactions to offline modes as they offer maximum convenience. Individuals can now pay their bills or make purchases from any location of their choice. The popularity of online payments has been increasing every day in India owing to the rise of payment aggregators such as Paytm.
• Increase in the number of office workers: As the number of working professionals continues to increase, there will be a surge in the number of online purchases. Accordingly, more transactions will take place via online payment portals.

Threats 

• Growing competition: More companies are entering the aggregating services spaces. Presently, there are quite a few online portals such as FreeCharge and MobiKwik that pose a threat to Paytm. Telecom companies like Airtel are now offering online payment options such as Airtel Payments Bank. Furthermore, even financial institutions, for example, banks, are now offering e-wallet services along with savings account.
• Change in domestic rules: Changes in relation to domestic laws and tax liability could have a negative impact on Paytm’s plans.