Mumbai-based fintech firm Paramotor Digital Technology Ltd has entered into a co-branded partnership with NSDL Payments Bank Ltd to issue co-branded prepaid cards across India. Announced on 17 August 2026, the agreement will combine Paramotor’s technology platforms with the bank’s licensed issuance infrastructure to offer secure and compliant payment solutions. The move strengthens Paramotor’s spend management and rewards ecosystem as it prepares for a public market debut.
What Does the Co-Branded Partnership Involve?
Under the agreement, Paramotor Digital Technology Ltd and NSDL Payments Bank Ltd will jointly issue co-branded prepaid cards that can be used for purchases at merchant outlets, online transactions and ATM withdrawals across payment networks such as RuPay, Visa and Mastercard. The cards will be issued under the bank’s licence and will operate as Prepaid Payment Instruments (PPIs), which are instruments that store value paid in advance and are later used for goods, services and fund transfers.
The collaboration is structured as a co-branding arrangement as defined by the Reserve Bank of India (RBI). In such an arrangement, the licensed PPI issuer handles all regulated functions including customer verification, risk management, fund handling and compliance, while the co-branding partner focuses on marketing, distribution and technology integration. Here, NSDL Payments Bank will be the issuer and will provide issuance services, escrow account maintenance and settlement, while Paramotor will provide technology capabilities, distribution reach and programme management.
The partnership will support Paramotor’s three vertically integrated consumer and enterprise platforms, SpendPro, Yayyy.shop and RewardOn, and enable industry-specific prepaid programmes for both retail consumers and corporate clients. Paramotor said the agreement will allow businesses to launch secure, compliant and scalable prepaid card programmes without building payment infrastructure from scratch. For the bank, the tie-up expands the reach of its prepaid issuance services through a fintech distribution network.
Understanding NSDL Payments Bank and Prepaid Instruments
What Are Prepaid Payment Instruments and Co-Branded Cards?
Prepaid Payment Instruments (PPIs) are payment instruments that allow users to pay for goods and services, send money and make transfers against money stored in advance. The Master Directions on Prepaid Payment Instruments, 2021, issued under the Payment and Settlement Systems Act, 2007, regulate PPIs in India, with a draft revision released in April 2026.
PPIs that need RBI authorisation are broadly of two types. Small PPIs, also called minimum-detail PPIs, can be issued after collecting basic details such as a mobile number verified with a one-time password and a self-declaration of identity. They are reloadable, issued only in electronic form, can hold a maximum outstanding balance of ₹10,000 at any point, and cannot be used for cash withdrawal or fund transfer. They must be converted to full-KYC PPIs within 24 months. Full-KYC PPIs are issued after full Know Your Customer (KYC) verification, are reloadable, and can be used for purchases, fund transfers and cash withdrawals. The outstanding balance in a full-KYC PPI cannot exceed ₹2 lakh at any point.
Two special categories are also permitted. Gift PPIs have a maximum value of ₹10,000, are non-reloadable and cannot be used for cash out or fund transfer. PPIs for Mass Transit Systems (PPI-MTS) are used for transit fare payments and have a maximum balance limit of ₹3,000.
PPIs can be issued as wallets or physical and virtual cards. A co-branded PPI is a PPI issued jointly by a licensed issuer and a co-branding partner, bearing the names of both entities. The issuer remains liable for all acts of the partner and must maintain funds in a separate escrow account with a Scheduled Commercial Bank. The co-branding partner’s role is limited to marketing and distribution. Until recently, a one-time RBI approval was needed for such tie-ups, a requirement the draft 2026 directions propose to remove.
NSDL Payments Bank at a Glance
NSDL Payments Bank Ltd is a payments bank headquartered in Mumbai, Maharashtra. It was incorporated on 17 August 2016 and commenced operations on 29 October 2018 after receiving a licence from the RBI under Section 22(1) of the Banking Regulation Act, 1949. It operates as a 100 percent subsidiary of National Securities Depository Ltd (NSDL), which is one of India’s two central securities depositories and was established in 1996.
Payments banks were recommended by the Nachiket Mor Committee in 2014 to advance financial inclusion, with the RBI issuing licensing guidelines on 27 November 2014. They are a differentiated bank model that can accept demand deposits up to ₹2 lakh per customer at end of day, offer payments and remittance services, and issue debit and prepaid cards, but cannot extend loans or issue credit cards.
India currently has six active payments banks: Airtel Payments Bank (New Delhi, launched 2017), India Post Payments Bank (New Delhi, 2018), Fino Payments Bank (Navi Mumbai, 2017), Paytm Payments Bank (Noida, 2017, now under regulatory restrictions), Jio Payments Bank (Mumbai, 2018) and NSDL Payments Bank (Mumbai, 2018). Authorised capital of NSDL Payments Bank is ₹200 crore with paid-up capital of ₹189.37 crore, and revenue was reported at ₹719.69 crore in FY 2024. Its Managing Director and Chief Executive Officer is Abhijit Madhukar Kamalapurkar, who took charge in March 2021. The bank offers services through its mobile app NSDL Jiffy, which allows fully digital account opening, funds transfer through NEFT, IMPS and RTGS, bill payments, virtual debit cards and support for Unified Payments Interface (UPI) transactions.
Why This Partnership Matters for Paramotor
Strengthening Three Core Platforms
Paramotor Digital Technology Ltd is a Mumbai-based financial technology company incorporated on 4 November 2016 as a private limited company and later converted into a public limited company. It is founded and led by Sonia Pankaj Asher, Promoter and Executive Chairperson and Whole-Time Director, and Rahul Anand, Promoter and Managing Director, who have together about four decades of experience in banking, payments and information technology.
The company operates four platforms. SpendPro is a prepaid card and spend management platform for consumers and enterprises, RewardOn is a rewards and loyalty management platform for employee engagement and channel incentives, yayyy.shop is a direct-to-consumer digital gifting marketplace offering gift cards from more than 225 brands, and DevStack provides custom enterprise technology and fintech software development. Paramotor acts as a programme manager for PPIs issued by banks and RBI-licensed issuers and as a distribution agent for brand gift cards. It is a DPIIT-recognised fintech startup under the Startup India programme.
The new partnership directly strengthens the first three platforms. Through co-branded prepaid cards issued by NSDL Payments Bank, Paramotor can offer reloadable general purpose cards for everyday and corporate spending through SpendPro, digital gift and closed-loop cards through Yayyy.shop, and rewards disbursement cards through RewardOn. The earlier arrangement announced on 6 August 2026 with Aditya Birla Capital Digital Ltd (ABCDL), the omnichannel direct-to-consumer platform of Aditya Birla Capital, followed a similar model, where Paramotor markets and distributes ABCDL’s prepaid instruments including physical cards, digital cards and gift cards. Together, these two partnerships in August expand Paramotor’s prepaid issuance network across two regulated issuers.
The IPO Context
The announcement comes as Paramotor prepares for a public listing. The company confidentially filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) in May 2026 through the confidential pre-filing route, which allows issuers to seek regulatory review without immediate public disclosure of issue size, valuation or financial details. This route was introduced by SEBI to give companies flexibility on timing and to protect sensitive business information.
As per disclosures cited in May 2026, Paramotor reported revenue of ₹112.3 crore in FY 2024-25, up about 232 percent year on year from ₹33.8 crore in FY 2023-24, with net profit rising to ₹29.2 crore from ₹5.4 crore. Authorised capital stood at ₹75 crore and paid-up capital at ₹38.8 crore as of February 2026. Lead managers reported for the proposed mainboard listing on NSE and BSE include Motilal Oswal Investment Advisors and Equirus Capital. By widening its prepaid card programmes ahead of the listing, Paramotor aims to show a scalable, asset-light model and a broader revenue base to investors.
Significance for India’s Digital Payments Landscape
Prepaid cards occupy a distinct space in India’s payment ecosystem even as UPI dominates retail transfers. Full-KYC PPIs are interoperable through UPI and card networks, which means balances can be used across merchants and platforms, and the RBI has permitted cash withdrawal up to ₹2,000 per transaction within an overall monthly limit of ₹10,000 for full-KYC PPIs, both for bank and non-bank issuers under prescribed conditions. NSDL Payments Bank is already among the largest prepaid card issuers in the country, with industry data indicating it had issued about 38.9 million prepaid cards, the highest among banks, followed by HDFC Bank with about 17.2 million, as of early 2026 disclosures.
For enterprises, co-branded prepaid cards help manage staff expenses, vendor payouts, channel incentives and customer rewards in a controlled and auditable way, with features such as spend limits, reload controls and transaction tracking. For consumers, they provide a cashless option for gifting, budgeting and online purchases without needing a full bank account, since full-KYC prepaid cards can be loaded from bank accounts or cards and used at points of sale, online and at ATMs.
The partnership also reflects a wider trend where fintech firms act as distributors and technology layers while relying on licensed banks for the regulated issuance layer. This helps ensure compliance with RBI requirements on escrow management, grievance redressal under the Reserve Bank-Integrated Ombudsman Scheme, 2021, and Know Your Customer and anti-money laundering norms, while allowing faster product rollouts.
The Way Forward
For Paramotor, the immediate test will be the rollout and adoption of the new co-branded card programmes across its corporate and retail user base and the integration with NSDL Payments Bank’s card networks. The company will need to align with evolving RBI directions on PPIs, including the draft RBI (Prepaid Payment Instruments) Directions, 2026 released on 22 April 2026, which proposes tighter controls on issuance and loading, a maximum one-year validity for gift PPIs, stricter inactivity handling and simplified co-branding compliance.
For the payments bank sector, deeper co-branding with fintechs offers a path to grow transaction volumes within the ₹2 lakh deposit limit and limited product scope. SEBI’s review of Paramotor’s confidential filing and any subsequent update to a public DRHP will determine the timeline for its proposed IPO. How the two August partnerships translate into transaction volumes, merchant acceptance and revenue before listing will be closely watched by customers, partners and market observers.
Key Takeaways
- Paramotor Digital Technology Ltd and NSDL Payments Bank Ltd announced a co-branded partnership on 17 August 2026 to issue co-branded prepaid cards across India.
- The cards will be issued as Prepaid Payment Instruments (PPIs) under the RBI’s Master Directions, with NSDL Payments Bank as issuer and Paramotor as co-branding partner for marketing, distribution and technology.
- NSDL Payments Bank, incorporated on 17 August 2016 and operational since 29 October 2018, is a 100 percent subsidiary of NSDL and is headquartered in Mumbai, with six payments banks currently active in India.
- The partnership supports Paramotor’s platforms SpendPro, Yayyy.shop and RewardOn and follows a similar distribution arrangement with Aditya Birla Capital Digital on 6 August 2026.
- Paramotor, founded on 4 November 2016, confidentially filed its DRHP with SEBI in May 2026 for a proposed NSE and BSE mainboard IPO, reporting ₹112.3 crore revenue and ₹29.2 crore profit in FY 2024-25.
