How Do Freecharge and PayTM Make Money? / Online Recharge offers from Mobikwik, Paytm, Freecharge

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The primary revenue source is commissions from Telcos which ranges from 2%(for large & Established operators) to as high as 5% (for new & small operators). This again depends on whether you are directly connected to the Telco's recharge platform or are using an Aggregator (like Oxigen, Euronet, Cyberplat). The margins would be lower in case of the latter.


Since the large operators contribute to the bulk of the txn volume, the average commission earned per txn would typically be in the 2.5-3% range.

 The average payment gateway charges are typically in the 1.8-2% range (will be lower now after the recent 1% cap on debit card MDR by RBI).

The net revenue per txn would therefore be around 0.5-1%. And that's the revenue (not profit) a recharge site makes.

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Contrary to media reports, Paytm says Uber customers' money in its e-wallets can be refunded

The rape by driver incident in Delhi has brought a lot of bad publicity for Uber. As if this is not enough, media is now seen as lambasting Paytm, the partner of Uber for e-wallet service, as well. .

  

In an article, Business Standard, wrote that "Uber's Paytm customers can't withdraw money from e-wallet". It says, "Typically, mobile wallets give customers the option of transferring money back to their bank accounts. But, this facility is provided only by those wallets registered with the immediate payment service (IMPS), a clearing and settlement system. At present, eight mobile wallets are registered with IMPS; Paytm is not one among these. Worse, wallet-to-wallet transfers among companies is prohibited by the Reserve Bank of India (RBI). This means, you cannot transfer money, for instance, from Paytm to Vodafone’s m-pesa, or from Paytm to any other mobile wallet provider. So, Uber customers with money in their Paytm accounts have no choice other than availing of other Paytm services, such as utility bill payments or online shopping, to use the amount."

However, Paytm has clarified that money of all customers of Uber, who using the e-wallet can be refunded. On its blog, Paytm, said, “Seems like there is some confusion.

Yesterday’s published article by Business Standard is wrong and misleading. Uber’s customers with a Paytm Wallet can withdraw their money from the e-wallet.”

Vijay Shekhar Sharma, chief executive of Paytm, has said that Uber consumers' wallets were not close looped or blocked. "I am committing on the wallet balance of consumers.

Your money is safe and secure whether Uber exists or not. Uber is just a merchant for us," Sharma said.

  

It is true that e-wallet like Paytm does not allow direct transfer of money from the wallet to the source, like bank account, except in case of refunds from merchants. Paytm says, "You can only transfer money if it has been refunded to your Paytm Wallet. If you have added the money to your Paytm Wallet then that money cannot be transferred to your bank account/ credit card. For transferring the money back to the source, you can click on the Refund tab against that failed order from your Paytm Wallet. It will take 3-21 days for the money to show in your bank account depending on your Bank’s policy."

  

“Paytm is an RBI licensed Wallet and the users’ money is protected under an escrow account with a National Bank. This means that their money is 100% safe,” the company added.

  

A digital wallet or e-wallet refers to an electronic device that allows an individual to make electronic commerce transactions. This can include purchasing items on-line with a computer or using a smartphone to purchase something at a store. Increasingly, digital wallets are being made not just for basic financial transactions but to also authenticate the holder's credentials, says Wikipedia.

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