Paytm, the payments and financial services arm of One 97 Communications Limited, has rolled out a new product called Pocket Money, a feature that allows teenagers to make UPI payments directly through the Paytm app, even if they do not have a bank account of their own. The announcement was made today via a regulatory disclosure filed with both the BSE and the National Stock Exchange of India.
What Is Paytm Pocket Money?
The feature is designed to solve a common problem faced by Indian families teenagers who need to make small everyday payments but have to rely on borrowing a parent’s phone, asking for OTPs, or sharing QR codes over WhatsApp just to pay for something as routine as a canteen meal or a metro ride. With Pocket Money, teens get their own access to Paytm UPI payments without needing a linked bank account, while a parent or trusted family member remains in full control of the setup.
The product is built on UPI Circle, a framework developed by the National Payments Corporation of India (NPCI). Parents can invite a teenager through this system, set a monthly cap on how much they can spend, and monitor every transaction in real time through the Paytm app.
Paytm has built in a graduated rollout for safety: payments are limited to ₹500 in the first half hour after setup, and capped at ₹5,000 in the first 24 hours. After that, individual payments go up to ₹5,000 with a maximum monthly spend of ₹15,000 across the UPI network. A device lock is required, and access can be modified or revoked at any time using a Paytm UPI PIN. The service works on both savings and current accounts but does not support international payments or cash withdrawals.
One of the more practical aspects of Pocket Money is its automatic integration with Paytm Spend Summary. Every payment made by the teenager is sorted into categories automatically, giving families a clear picture of where money is going whether that is transport, food, shopping, or recharges. This makes it easier for parents to manage monthly allowances and have informed conversations with their children about spending.
How to Set It Up
Setting up Pocket Money requires updating the Paytm app to the latest version. After that, the process involves these steps:
- Open the app and go to “To Mobile / Contact”
- Select “Pocket Money” and choose the contact to set it up for
- Scan their UPI QR code or enter their UPI ID
- Complete the required verification steps
- Set a monthly spending limit (custom or preset)
- Link a primary bank account and enter your Paytm UPI PIN
- The teenager accepts the invitation to activate access
Digital payments among younger users in India have grown significantly, but formal access has lagged because most UPI accounts require a bank account linked to a valid ID. Pocket Money fills that gap by letting teens participate in the UPI ecosystem in a supervised manner, which could be an important step toward building early financial literacy in a country where Paytm counts its mission as bringing half a billion people into the mainstream economy.
For families looking to manage allowances digitally rather than in cash, this launch offers a practical and structured alternative that keeps parents in the loop without removing the teenager’s sense of independence.
