Is Paytm Money better than Zerodha?
- Asked By
- Updated On:22-Jun-2021
- Replies:3
Short Answer
You wish to know if Paytm Money is better that Zerodha or it's the other way round. Zerodha being a leading discount broker in India has been there for overe a decade now. While Paytm Money already established in mutual fund investment arena, but a fairly new entrant in stock broking industry. So, let's compare the features and discuss few details on each of them.
Detailed Answer
The name “Paytm” resounds incredibly amongst millions of people in the country. But with its strategy of entering the stock brokerage sector, things have stirred up a bit. No doubt that there are several colossal stock brokerage players in the game already, but the best comparison of it would be with Zerodha (the topmost discount broker in India since long).
Recently, Paytm money announced that it surpassed 6.6 million users and surpassed the total users on Zerodha. Though both of stock broking companies offer an extensive array of products and services to its customers, there shall be a long term debate to be seen on which ones happens to be the better.
Well, in this case, is Paytm money better than Zerodha? Or is just a hype bubble waiting to burst? Let’s find out.
Paytm money better than Zerodha: Which is better?
To give a better insight as to why Paytm money may or may not be better than Zerodha, we have a few parameters that are designed to showcase the differences. Let's take a closer look:
1. Paytm vs Zerodha: A Quick Overview
Paytm money is owned by One97 Communications Ltd which completed it two years of operations in offering investment opportunities in mutual funds alone. Though it acquired its SEBI license back in April 2019, it started offering stock brokerage services in August itself.
On the other hand, Bangalore based Zerodha has dealt with offering stock brokerage services back form 2010 (over a decade now) and has a resounded impact on million of traders/investors looking to invest in the stock and trades. Customers trust this company for sure owing to its reliability, services, and advanced features that have been added to its trading platforms so far.
2. Registration and Brokerage Charges
Moving ahead with the registrations, Zerodha is a depository participant of CDSL, and the account opening charges are 300 rupees with Demat account maintenance charges at 300 rupees per annum. Paytm money is a depository participant with the CDSL and NSDL with account opening charges at 300 rupees and Demat account annul maintenance charges at 250 rupees per annum.
Paytm charges ₹0.01 per executed order when you take delivery of shares in your demat account whereas equity delivery is completely free in Zerodha. For Intraday trading, Zerodha has a flat fee of ₹20 or 0.03% (whichever is lower) per executed order and Paytm charges a minimum of 0.05% of turnover or ₹10 as applicable.
3. Other Crucial Factors:
Paytm money is trying to expand its outreach to lakhs of users per month and set a full-scale lunch of brokerage services by the end of 2020 and expects to reach 100,000 trades in a single day.
Zerodha has been in the stock brokerage services since a decade has its trading platform to handle all volumes and volatilities of the market. Its future aim is to launch “loan against securities” and many such additional services.
Limitations of Paytm Money
1.The option for trading in derivatives such as futures and options trading isn’t there.
2.Currency and commodity trading hasn’t been activated for customers to trade through the platform.
3.Paytm money doesn’t have a dedicated platform such as “Kite” for Zerodha in handling large volumes of customers and market volatility.
No doubt, Paytm money has created some tremors amongst the stock brokerage companies all thanks to its popularly and the services it offers. But when you try and compare Zerodha and Paytm money, things could look promising amongst them both.
Zerodha is a far more experienced as a discount brokerage company actively offering its state-of-the-art brokerage platforms under Zerodha Kite while Paytm money utilizes its mobile platforms to provide the same. Though in its nascent stages, Paytm money will have to revamp its services and offering to meet the customer demands and satisfaction for other traders even to have a keen interest to consider it as it stock brokerage platform.
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Discussion (2)
Zerodha is quite an old player, as you pointed out it's been into the stock market industry since over a decade, so definitely it has a number of advantages over any emerging entrant. May it be effectively handling a huge client base while offering good services, maintaining a robust trading platform with millions of clients on board, Zerodha currently outranks Paytm in many aspects. However, Paytm is also a reputed brand name, so it will be really interesting to see how different discount brokers, new and old manage their ways and outperform each other.
Yes, Zerodha is much better than Paytm money, thanks to the discrete offerings that Zerodha brings to the table. Zerodha has been in the stock brokering business for a decade whereas Paytm money was founded in 2017. The experience, knowledge, tools, and trading options provided by Zerodha are quite prominent and useful when compared to Paytm money.
Zerodha and Groww are both good players in the Discount Broking space but both have some differences. Zerodha has the largest client base and is the most trusted Broker in India whereas Groww is one of the fastest-growing Discount brokers. Both offer different features to their clients which is discussed in detail below.
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Fixed Deposit (FD) are saving tools offered by banks to deposit lump sum amount for a fixed period of time on a higher interest rate than saving accounts. Mutual funds are investment products which pool money from numerous small investors to create a fund.
You can download the account closure form the given link - Demat Account Closure Form and post it to the address mentioned in the form.
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Zerodha as well as Groww, both allow investors to invest in Mutual funds. Groww does not charge any Account opening fees or Annual maintenance Charges but Zerodha charges Rs 200 for Account opening and Rs 300 for AMC. This makes Groww a cheaper and better option when it comes to investing in mutual funds.
With every stock broker, including the likes of Paytm Money, some disadvantages might be a trade-off in choosing them. These include the unavailability of trading with currency and commodities, trading in futures is still not available, the trading platform isn't robust, etc.
Harshil Patel
Paytm is quite a nascent application when compared to Zerodha. Zerodha has been in the market for year dedicating itself in offering explicit stock market trading platforms. However, Paytm has a larger userbase that makes it quite interesting as to which one is better. If Paytm could revamp their services offered, then it could become quite a promising stock trading application.