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Advertisements of Paytm, a digital wallet company, are seen placed at stalls of roadside vegetable vendors in Mumbai, India, November 19, 2016.Reuters file

Paytm is no longer just a mobile wallet company as founder Vijay Shekhar Sharma is pulling every possible string to make the company a one-stop shop for all retail and financial needs of Indians.

Paytm, owned by One97 Communications, is now planning to launch services including mutual funds, general insurance, life insurance and a number of banking services via its payments bank.

But why foray into mutual funds?

"Wealth management business is the logical next vertical for Paytm to foray into after payments and banking," Pravin Jadhav, the senior vice president at Paytm Money, told International Business Times India over an email.

The company is likely to start mutual funds distribution business with the launch of its digital platform by the end of April. The distribution will be done through Paytm Money, the new wealth management unit of One97 Communications.

Paytm Money is in discussions with asset management companies to offer direct mutual fund investments.

The new app will offer investors mutual funds from 12 of the 15 largest asset management companies in the first phase. By August, it aims to increase that to around 25 fund houses.

"Paytm Money will offer only direct plans of mutual fund schemes that will provide up to 1.5 percent higher returns than regular plans because of lower expense ratio and no hidden commission," said Jadhav.

Paytm aims to increase the penetration of mutual funds through its app at a time when products like systematic investment plans (SIPs) are gaining a lot of traction among the young retail investors.

Despite the growing interest, only 28 percent of individual investors' assets in mutual funds come from beyond the top 15 towns, according to the Association of Mutual Funds of India.

Paytm aims to leverage this opportunity by creating awareness and easing mutual funds purchase.

"Mutual fund industry today has about 15 million investors, we believe this number will double in next 3-4 years. We want to introduce wealth management products like mutual funds to Paytm's 300+ million users," said Jadhav.