Paytm has finally launched it own payments bank. Paytm Payments Bank, which was launched recently, has finalized a five-member board as it gears up to expand its physical presence to 31 branches and 3,000 customer service points in the first year.

The board will include P.V. Bhaskar, former executive director at the Reserve Bank of India, Ash Lilani, co-founder and managing partner at Saama Capital, and G.S. Sundarajan, a former director at the Shriram Group, as independent directors. Vijay Shekhar Sharma, founder and chief executive of Paytm (One97 Communications Ltd) and Renu Satti, chief executive of Paytm Payments Bank, will also be on the board.

“We are honoured to welcome Bhaskar, Sundararajan and Lilani to the Paytm Payments Bank board. We are privileged to have such imminent experts as mentors, as we chart our way towards building India’s most trusted and consumer-friendly bank and bring half a billion Indians to the mainstream economy,” Satti said in a statement.

Paytm aims to invest Rs. 400 crore over the next two years to build its banking network across the country. The first physical branch of Paytm Payments Bank went live in Noida. “We will first start the services in Delhi-NCR followed by the second phase of launch in other top metro cities,” Sharma had said. The second phase of the rollout is expected after three months. The company is expecting a customer acquisition cost of Rs. 125 – 150 crore over the next 12 months.

Paytm Payments Bank will offer accounts with a zero balance requirement and every online transaction, such as immediate payment service (IMPS) transfers, will be offered free of charge. For savings accounts, the company will also offer an interest of 4% per annum, much lower than competitor Airtel Payment Bank’s 7.2%.

Paytm Payments Bank will also offer a cashback of Rs. 250 to its first million customers who reach a deposit of Rs. 25,000. The company will issue debit cards with an annual fee of Rs. 100 in partnership with RuPay.

Paytm Payments Bank has already received investment of about Rs. 220 crore from One97 Communications Ltd and its founder Sharma in November last year. Sharma was one of the 11 recipients of the Reserve Bank of India’s payments bank licence and has personally invested Rs. 112 crore of the total investment received.

Paytm will move all active wallet accounts on the Paytm app to the payments bank. But it will allow users who do not wish to transfer their accounts to opt out by written request; for accounts dormant for six months and having zero balance, Paytm will transfer wallets only when the user notifies it to do so.

In November last year, Bharti Airtel’s Airtel Payments Bank became the first payments bank to start operations, followed by India Post Payments Bank, in the aftermatch of the note ban exercise.