Airtel Payment Bank Vs Paytm Payment Bank

Instead of comparing, first think why Payments bank came and set a new level in digital generation? What prompted regulators and Govt to issue such license.
Circa 2013, banks were coming up with mobile based banking services and found converting customers with mobile connections but not having bank account. Banks found ARPU ( Average revenue per user) in the range of Rs.1500/- and above for prepaid recharge for millions of subscribers and found through financial inclusion (BC banking) they can be serviced for lesser balance in account.
Meanwhile, telecom service providers found ways to convert prepaid balance to be transferred to another customer with in CUG and thus mobile wallets of telecom operators found ways.
Wait story becomes interesting as we see OXYGEN kind of players installing kiosks at recharge merchants ( more than half million) across India for SBI -Financial inclusion banking services as well as residual revenue stream of customer recharge.
There was issue as telecom operators recharges and it’s money operation in wallets was not reported to RBI but it’s substantial few 100s millions INR which can increase as time goes and thus, TRAI, RBI and Govt enforced KYC norms and included wallet service providers under payment banks license.
Thus, you see each of these coming under strong control of regulators although it’s more reporting and control purpose. This enables high visibility of customer numbers growth, transactions across telecom as well as non telecom ( PayTM and more) registered for reporting as well as controls seen for e.g. non KYC merchants have cap on weekly cumulative transaction amount limits.
Since, these banks have its own brand, customer base and banking services to offer to it’s customers, most wide spread delivery channels and agents across the region, traditional banks ( Universal banks) can collaborate with these players to cross sale banking, insurance and wealth management services. ( E.g. SBI and Reliance money collaborate).
Now addressing your query, these banks (Airtel and PayTM) can prevail acquire customers, collaborate, win and loose business just as wallet service provider marketplace which is becoming level playing game slowly in India.
PayTM strategy of burning money will stop as those advantage of Nov 2016 is no more lucrative and need to find ways such as offering more products than other e-commerce players.