Paytm withdraws 2% fee levy plan on adding money from credit card to focus on new security features to prevent credit card misuse

Paytm now withdraws the 2% charge on credit cards for adding money from credit card to paytm accounts. Paytm has introduced the service yesterday, to prevent the misuse by some customers and it has now said that the rollback occurred to prevent inconvenience to larger segment of customers.

Paytm, a few months back (demonetisation) waived off the transaction charges for the money transferred to the bank account in a view of getting more people to use its platform. But customers have found a loophole in the service and are using the service to transfer money from credit card to the wallet free of cost and then the money can be added to the bank account to avail loyalty points for using the credit card.
For the money that is added via credit card, paytm pays  2% service charge to the credit card issuing bank. Due to the misuse of the service paytm has been witnessing losses. To keep a check on misuse of the service, paytm said to levy a transaction charge of 2% for the money added via credit card to wallet. However, paytm said the 2% charge will be given back to the customers in the form of various coupons where they can avail them during purchases made on its platform.

But today, paytm has said that it has suspended the 2% fee on credit card recharges through its official blog post. Paytm also said that it will introduce a new feature to prevent the credit card misuse to add money.

"With an intent to prevent the misuse of transfer to bank facility at 0%, we had applied a refundable fee of 2% on add money through credit cards. At the same time, we are conscious that this move caused inconvenience to a large segment of our users, including those who are using their credit card for genuine transactions."

"Keeping the millions of customers and merchants interest as an utmost priority, we have decided to suspend the 2% fees and will continue to build a series of features to curb such misuse". Paytm mentioned in the blogpost.

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