Current Paytm Wallet cannot be used for overseas payments

Chinese payments company Alipay and India’s Paytm recently joined hands to increase adoption of digital wallets by small store owners in India and China. As a part of the initiative, Alipay was perched to offer Paytm its technological capabilities and risk management systems to help it grow faster and offer a better customer experience.

However, while Paytm and Uber have tied up with Alipay, payments you make through the current wallet will be subject to licensing under FEMA (Foreign Exchange Management Act,1999). Any cross border payments services by the payments bank will be offered subject to FEMA authorizations and RBI approvals. As such, the current Paytm Wallet cannot be used for overseas payments.

Further, the proposed tie up with Alipay does not envisage the use of the current Paytm Semi Closed Wallet for cross border transactions. As per the existing authorization, the wallet can only be used in India.

Paytm’s backend will be integrated with Alipay by the end of this year.

Paytm’s comment is awaited.

Image credit: Indiatimes