Pai Platforms, backed by Paytm founder Vijay Shekhar Sharma, has allegedly introduced a new shopping application on the government's Open Network for Digital Commerce (ONDC) platform. The recent app, called PaiPai, is said to have been created by the parent company of the fintech major, One97 Communications. The report highlights that Paytm has no ownership stake in Pai Platforms.
In February, Paytm rebranded its e-commerce division as Pai Platforms and purchased Bitsila, a Bengaluru-based seller-side platform on ONDC. Paytm's competitor, PhonePe, backed by Walmart, also entered the ONDC space by unveiling a new shopping app called Pincode in April 2023.
Last year, while speaking at an industry event, Sharma said, “E-commerce is a natural extension for us. We are committing to sign up at least 10 million merchants on ONDC before 2025 ends. This means that ONDC has already become a significant player in e-commerce. There are around 50 million e-commerce users in India and over a fifth are already on ONDC".
Sharma also mentioned that 11.8 million users have already made purchases on ONDC through Paytm. Prior to its rebranding as Pai Platforms, Paytm operated its e-commerce sector under the name Paytm Mall. In 2018, the company's e-commerce division secured $400 million from investors such as Alibaba and SoftBank, valuing it at over $2 billion. However, in 2022, Alibaba divested its entire stake in the company, with the valuation standing at just over Rs 100 crore.
According to industry sources cited in the report, it was revealed that the company might have opted to introduce a fresh e-commerce application to distinguish between its fintech and e-commerce operations. The report also highlighted that this decision could be attributed to recent regulatory actions taken by the Reserve Bank of India (RBI) concerning the company's banking entity, Paytm Payments Bank Limited (PPBL).
In January, the central bank instructed PPBL to cease accepting deposits or top-ups in any customer account, prepaid instruments, wallets, FASTags, and NCMC cards after February 29. RBI expressed concerns regarding PPBL's non-compliance with KYC and other regulations.