What is it about?
This case is about the e-wallet business of a company called, Paytm, set up in India. It questions the strategic choices being made by the company in an industry that is a changing at a very rapid pace. The company started as a digital payment platform and diversified into e-commerce eventually. This case focuses on its wallet business specifically. The company stands at a competitive advantage as it started early and therefore, has acquired a considerable share of this new market in an emerging economy, i.e., India (India as an economy is largely dependent on cash yet Paytm has managed to gain acceptance). Paytm's wallet is unique as it has a vast range of offerings i.e., facilitating payments for mobile recharge, utility bills, train tickets, bus tickets, movie tickets... and list is endless. It became a unicorn (term for an unlisted company valued at over a billion dollars) in March 2017. The question is, Is everything hunky dory for Paytm or is it time to adapt to the new environment? Can it continue with its exponential growth or is it time to limit its scope?
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Why is it important?
The case describes in simple language the exponential growth of the company, the opportunity of demonetization (a decision by Indian Government in September 2018 to withdraw all high value currency notes) capitalized by the company, and the emerging challenges it is set to face such as, overheated competition,corporate giants such as Amazon, Google and WhatsApp entering as new players in the Indian payments industry, introduction of stringent regulations by the central bank of the country, i.e., RBI. This case is important as it poses a critical question to the students -Is the company on the right path by growing at full throttle or does it need to slow down? The case is relevant in today's times as wallet business is growing unprecedentedly in countries such as India. It poses real life dilemma that the start-ups and business managers would be facing in the real world. Therefore, the case simulates a real business problem and asks the students to resolve the dilemma.
Perspectives
This case would give students an experience of the real problems faced by business leaders. Students who aspire to launch a start-up should see this as an opportunity to develop business instincts for devising corporate strategy. Students who aspire join as managers should see this as an example as to how one decision can change the fate of a company.
Sumedha Tuteja
IMS, Ghaziabad
Read the Original
This page is a summary of: Paytm’s wallet business: on a growth trajectory or suicide mission?, The CASE Journal, January 2018, Emerald,
DOI: 10.1108/tcj-07-2017-0063.
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