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Recovery Signs Emerge for Paytm

Paytm continues to be the third largest player in terms of market share…reports Asian Lite News

Payment and financial services company Paytm is witnessing early signs of recovery and strong stabilisation for its Unified Payments Interface (UPI) business, marking a strong turnaround for the company.

The total value of UPI transactions processed on the Paytm platform grew to Rs 1.24 trillion in May, on the back of the company launching several initiatives for users such as Credit Card on UPI, as well as pushing the lever on UPI Lite.

With total transactions on the platform stabilising at 1.14 billion in May, Paytm which became a Third-Party Application Provider (TPAP) in March, continues to be the third largest player in terms of market share. Further, considering the breadth of its merchant base, the company continues to be leading among peer-to-merchant (P2M) UPI transactions.

Paytm also remains the only Indian company to challenge the duopoly of Google Pay, the Indian payments arm of US search behemoth Google and PhonePe, which has US retail giant Walmart as its majority shareholder.

In May 2024, UPI reached a milestone by handling nearly 14 billion transactions, a substantial 49 per cent (year-on-year) increase, and processed transactions worth Rs 20.45 trillion — its highest since launch in 2016. This surge underscores the growing preference for digital payments among Indian consumers and businesses.

Paytm has been bullish on UPI and has formed partnerships with various banks and financial institutions including Axis Bank, HDFC Bank, State Bank of India (SBI) and YES Bank to enhance its UPI service.

As a part of its earnings, the Noida-headquartered company said that the move further ‘de-risks’ its business model. Features like UPI Lite launched by Paytm on its platform help users make seamless payments avoiding the risk of payment failures.

This service is especially useful for those who frequently handle small payments like buying groceries, paying for parking, or settling daily commute fares. It also keeps the bank statement clutter-free with only a single entry, regardless of the number of payments made, which is a significant convenience for users who prefer a clean financial overview.

The company received UPI incentives of Rs 288 crore for FY 2024 (recorded in Q4 FY24), compared to Rs 182 crore in FY 2023 (recorded in Q4 FY23), showcasing its sustained growth with the payments infrastructure.

The overall growth in digital payments in India, driven by supportive government policies, indicates a shift in consumer behaviour towards cashless transactions.

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Paytm Pushes for a Turnaround

The company has launched a series of ad films to highlight key aspects of Paytm’s core business. …reports Asian Lite News

One97 Communications Limited (OCL), which owns leading payments and financial services company Paytm, on Thursday launched a new ad campaign to enhance existing user engagement by showcasing the company’s reliable payment products and experience.

This campaign promotes UPI money transfers, Scan and Pay, pioneering Soundbox, Paytm UPI Lite wallet, Credit Card on UPI, recharges & bill payments along with other payment instruments available on the Paytm app, reflecting key focus areas in Paytm’s path to recovery.

These verticals will now form a significant part of Paytm’s payment GMV, moving forward. For instance, UPI which earlier contributed to 70 per cent of Paytm’s payment GMV, is now fueling 80 to 85 per cent of the GMV.

“As we prepare ourselves for strong growth in FY25, we remain committed more than ever to bring more Indians into the mainstream economy and spread payment infrastructure such as UPI, payment QR codes and Soundbox in every nook and corner of this country,” a Paytm spokesperson said.

“Our ad campaign reflects our commitment: every time India plans its future, we’ll be at the centre of it, and as you move forward in life, Paytm will always be by your side,” it added.

Reaffirming its commitment to payments as its core business, Paytm while announcing its FY24 results, said that it has started witnessing recovery across its payment GMV and subscription merchants. It looks forward to showcasing improvements in key metrics starting the second quarter (Q2) of FY2025 and is invested towards gaining market share in the core payments business.

Over the past years, Paytm has brought through industry-first innovation with products like the ‘Made-in-India’ Paytm Soundbox and QR codes, setting the tone for the Indian digital payments industry.

The company has launched a series of ad films to highlight key aspects of Paytm’s core business. The first film focuses on UPI Money Transfer, demonstrating how users can send money using UPI on the Paytm app.

As a Third-Party Application Provider (TPAP) with NPCI, Paytm has partnered with Axis Bank, HDFC Bank, State Bank of India (SBI), and YES Bank to ensure seamless UPI payments.

The second film features the Scan and Pay option, allowing users to scan any QR code with the Paytm app for instant payments. The third film showcases the Made-In-India Paytm Soundbox, providing merchants with secure payment confirmations.

The fourth film highlights the Paytm UPI Lite wallet for low-value everyday payments, keeping bank statements clutter-free and allowing users to add up to Rs 4,000 daily.

The fifth film introduces the Rupay Credit Card on UPI, enabling users to link their credit cards to UPI and pay at merchant stores by scanning QR codes, eliminating the need to carry physical credit cards.

The company’s emphasis on ‘Jab bhi India future ka plan banaega, humein uske beecho beech paayega, aage bhi Paytm aapka yuhi saath nibhayega’ underscores its promise to be a trusted partner for all Indians, especially during big milestones.

The ad films are set to go live across various media channels including television, digital platforms, and social media.

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Loss Drives Paytm to Restructure

Paytm.

Paytm said that it anticipates “tangible results from these initiatives in the coming quarters”, further bolstering our competitive advantage in the market….reports Asian Lite News

In order to achieve significant cost efficiencies through artificial intelligence (AI)-led capabilities, digital payments major Paytm is planning a “leaner organisation structure” and the “pruning of non-core businesses”, indicating there may be job redundancies at the company in the near future.

In key focus areas, as mentioned in the company’s stock regulatory filing, Paytm said that led by capabilities of AI and focusing on core business, “we are also working on significant cost efficiencies including leaner organisation structure”.

“Our ongoing experiments and learnings in AI promise to revolutionise customer and merchant care for the financial industry, while also unlocking new avenues for revenue generation and cost savings,” said the financial services provider.

Paytm said that it anticipates “tangible results from these initiatives in the coming quarters”, further bolstering our competitive advantage in the market.

One 97 Communications Ltd, the parent company of Paytm, clocked a net loss of Rs 550 crore in the January-March period of FY24, a 3.2 times jump compared to the same period in the last fiscal year.

Paytm’s revenue was down by 20 per cent compared to the previous quarter.

Its quarterly result took a beating after the Reserve Bank of India’s (RBI) ban on some of the services of Paytm Payments Bank (PPBL).

The company posted a 3 per cent decline in its revenue for the fourth quarter of FY24 to Rs 2,267 crore.

The decline, said the company, was primarily influenced by macroeconomic challenges, competitive intensity and regulatory changes.

Despite the revenue dip, Paytm said it achieved significant progress in improving its profitability and operational efficiency.

Revenue from operations witnessed an increase of 25 per cent year-over-year (YoY), reaching Rs 9,978 crore in the full fiscal year (FY24).

This growth was primarily driven by an increase in gross merchandise value (GMV), expansion in device additions, and the expansion of financial services offerings.

Paytm’s Gross Merchandise Value (GMV) increased 39 per cent YoY at Rs 18.3 lakh crore in FY24.

As of March 2024, merchant subscriptions were 1.07 crore, increasing by 39 lakh (YoY).

Overall loss fell by Rs 354 crore YoY to Rs 1,423 crore, on the back of improved growth and increased operational profitability.

Additionally, Paytm’s earnings before interest, taxes, depreciation and amortisation (EBITDA) before employee stock ownership plans (ESOPs) surged to Rs 559 crore, said the company.

Paytm’s Payment Services for FY24 stood at Rs 6,235 crore. This growth was driven by the widespread adoption of digital payments and Paytm’s continued focus on expanding its merchant base, the company added.

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Paytm Expands Leadership Team for Financial Services Growth

Vijay Shekhar Sharma, Founder and CEO, Paytm, thanked Bhavesh Gupta for his contributions and his role in ensuring a smooth transition…reports Asian Lite News

The One97 Communications Limited (OCL), which owns Paytm, on Saturday announced to expand its leadership team to build a large and profitable payment and financial services distribution business.

Bhavesh Gupta, President and Chief Operating Officer, who was overseeing the payments and lending businesses, has decided to take a career break due to “personal reasons”, the company said in a statement.

He will be transitioning to an advisory role, offering guidance for Paytm’s growth initiatives until the end of the year.

Vijay Shekhar Sharma, Founder and CEO, Paytm, thanked Bhavesh Gupta for his contributions and his role in ensuring a smooth transition.

“Our focus on payments and lending is stronger than ever, and I will work with the seasoned leaders that we have in each of our businesses to execute our plans,” said Sharma.

Gupta said he looks forward to supporting Paytm in an advisory role.

“I am confident of Paytm reaching new heights given the depth of leadership in payments and financial services that has been built over the past few years,” he said.

The company has also undertaken leadership transitions within its wealth subsidiary where Rakesh Singh has recently been appointed as the new Chief Executive Officer of Paytm Money Ltd (PML).

Varun Sridhar, former head of Paytm Money Ltd, now leads as CEO at Paytm Services Pvt Ltd (PSPL), marking a transition to new leadership responsibilities.

“I am also excited about the direction that we have taken under the leadership of Varun to expand Paytm’s role in deepening penetration of mutual fund and wealth management products in our country,” said Sharma.

“I welcome Rakesh to Paytm Wealth business where we are committed to build world-class technology led wealth offerings to young Indians,” he added.

Singh said that stepping into the role of CEO at Paytm Money Ltd is “both an honour and a responsibility”.

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Paytm Refutes Layoff Claims

Paytm.

In its filing Paytm said that such reports were baseless and inaccurately represent the company’s operational and strategic planning…reports Asian Lite News

In an exchange filing on Saturday, One97 Communications Ltd (OCL), which owns and operates the Paytm brand, has formally announced that Praveen Sharma, Senior Vice President – Business, has resigned from his position on March 23.

The release says, Sharma is stepping down to pursue opportunities in the next phase of his professional journey. Before joining Paytm, Sharma spent nine years in leadership roles at Google, covering India and the APAC region.

Addressing recent speculations, Paytm also emphatically denied reports suggesting a 25-50 percent workforce reduction in specific business segments.

In its filing Paytm said that such reports were baseless and inaccurately represent the company’s operational and strategic planning.

According to the filing, Paytm is currently engaged in its annual appraisal process, a routine organizational practice aimed at assessing and enhancing team performance. This process, focused on performance evaluations and role alignments, is standard across industries and is not indicative of layoffs.

The company also clarified that its restructuring efforts and performance-related adjustments are misconstrued as layoffs. The filing says that Paytm reassures its commitment to growth and operational efficiency without compromising its workforce’s stability.

The exchange filing quotes a Paytm official statement asserting, “The claims of layoffs affecting 50% of our workforce are unfounded and misleading. We are focused on sustainable growth, innovation, and providing exceptional service to our customers. We urge our stakeholders and the public to rely on factual and verified information from official sources and disregard speculative narratives.”

The company further says that Paytm remains dedicated to its mission of leading the digital payments and financial services landscape in India, reinforcing its commitment to innovation, customer service, and team development amidst unfounded layoff speculations.”

As the Reserve Bank of India’s (RBI) deadline to put certain business restrictions on Paytm Payments Bank Limited (PPBL) ends on Friday, here are some key changes for millions of Paytm users and merchants that will come into force.

First of all, those having a savings bank or current account with Paytm Payments Bank will be not able to deposit money into their account.

No credits or deposits other than interest, cash-backs, sweep-in from partner banks or refunds are allowed to be credited, according to the Central Bank.

However, one can continue to use, withdraw or transfer funds from their account up to the available balance in your account.

Also, refunds, cashbacks, sweep-in from partner banks or interest are permitted and credits into the account even after March 15, 2024.

“The existing Deposits of Paytm Payments Bank customers maintained with partner banks can be brought back (sweep-in) to the accounts with Paytm Payments Bank, subject to the ceiling on balance prescribed for a Payments Bank (Rs 2 lakh per individual customer at the end of day),” according to RBI.

However, no fresh deposits with partner banks through Paytm Payments Bank will be allowed after March 15.

If one’s salary is credited into the account with Paytm Payments Bank, they will not be able to receive any such credits into your account post the deadline.

Withdrawal/debit mandates–such as National Automated Clearing House (NACH) mandates–will continue to get executed till there is balance available in your account.

“However, after March 15, 2024, credit or deposit in your accounts will not be allowed. Therefore, to avoid inconvenience, it is suggested that you make alternative arrangements through another bank, before March 15, 2024,” RBI had said in its guidelines.

For merchants using Paytm Payments Bank to receive payments, if their receipt and transfer of funds is linked to any bank account other than Paytm Payments Bank, they can continue to use this arrangement even after March 15.

However, after March 15, “you will not be able to receive any credit into your bank account or wallet with Paytm Payments Bank other than refunds, cashbacks, sweep-in from partner banks or interest.”

It is suggested that a user obtain a fresh QR code linked to an account with another bank or wallet to receive payments. One may also change their bank account details (in which they receive payments) through their service provider.

On Friday, the National Payments Corporation of India (NPCI) granted approval to One97 Communications Limited (OCL), the parent company of Paytm, to participate in unified payments interface (UPI) as a third-party application provider (TPAP) under multi-bank model.

Four banks (Axis Bank, HDFC Bank, State Bank of India, YES Bank) will act as PSP (payment system provider) banks to OCL.

“YES Bank shall also be acting as merchant acquiring bank for existing and new UPI merchants for OCL,” the NPCI said.

Meanwhile, the National Highways Authority of India (NHAI) has advised Paytm FASTag users to procure a new FASTag issued by another bank before March 15. They can use their existing balance to pay the toll beyond the stipulated date.

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Delhi Tops Paytm Night Payments

If all the Paytm QR codes used this year were stacked up, it would be taller than 40 Qutub Minars…reports Asian Lite News

One97 Communications Limited (OCL), which owns Paytm, said on Wednesday that a whopping 912 crore merchant payments were made using the leading financial and payments provider in the second quarter (Q2) of FY24.

When it comes to making most payments between 12 midnight and 6 a.m., Delhi outshined cities like Hyderabad, Bengaluru, Chennai and Goa, according to the ‘Paytm Recap 2023’ report.

The Recap showcases a year of leadership in payments and incredible user engagement on its app.

“As the pioneer of QR code, soundbox and mobile payments in India, we continue to see widespread acceptance of Paytm, with increased adoption among both consumers and merchants,” said a Paytm spokesperson.

“In 2023, we achieved new milestones and further cemented our leadership in payments. We continue to lead technology for India’s small shops and remain focused on driving financial inclusion in India,” the spokesperson added.

If all the Paytm QR codes used this year were stacked up, it would be taller than 40 Qutub Minars.

Over 55 lakh challans worth a staggering Rs 179+ crore were paid on Paytm, enabling users to settle dues in a convenient way, according to the company.

Paytm continues to strengthen its leadership in in-store payments, with more than 92 lakh Paytm pioneered devices such as Soundbox, Card Machines, etc. in the quarter ending September 2023.

Paytm was the first to launch QR code-based payments, and instant audio confirmation with the Soundbox device.

This year, the company launched three new Paytm Soundbox devices for merchants — Pocket Soundbox, Music Soundbox, and Card Soundbox.

“An intriguing observation is that the maximum number of payments have been made on Saturday, making it the busiest day in the week for digital transactions,” said the company.

Users from places like Dharwas in Himachal Pradesh and Laitmawsiang in Meghalaya have made ‘Paytm Karo’ an integral part of their lives.

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Paytm Expands Credit Business

Paytm.

Paytm continues to focus on merchant loans that are lended to MSME as business loans. …reports Asian Lite News

Paytm, India’s leading mobile payments and financial services distribution company, on Wednesday said it will expand its credit distribution business in partnership with large banks and NBFCs by offering higher ticket personal and merchant loans to lower risk and high credit-worthy customers.

Owing to the strong portfolio performance and widespread acceptance of loan distribution, Paytm witnessed encouraging early trends when the company started working in this direction last quarter.

“As the lending distribution business is maturing, we see newer opportunities of expansion to offer high-value personal and merchant loans. We will continue to focus on originating the high portfolio quality for our lending partners, along with strict adherence to risk and compliance. We have seen great scale and acceptance for our loan distribution business, so we believe this expansion will further aid us to grow the business,” said a Paytm spokesperson.

In the light of recent macro development and regulatory guidance and in consultation with lending partners, the company remains focused on driving a healthy portfolio and has recalibrated the portfolio origination of less than Rs 50,000 – prominently the postpaid loan product will now be a smaller part of its loan distribution business moving forward.

Paytm continues to focus on merchant loans that are lended to MSME as business loans. Given that these loans are extended for business purposes to support small merchants, they remain unaffected by the recent regulatory guidance.

The company said it continues to add banks and NBFCs as its lending partners for its loan distribution business.

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How Paytm Revolutionising Merchant Payments

After the recent successful launch of Paytm Pocket Soundbox and Paytm Music Soundbox, with Paytm Card Soundbox, the company is driving further convenience for merchants…reports Asian Lite News

Paytm, India’s leading payments and financial services company and the pioneer of QR and mobile payments, on Monday launched its latest innovation — Card Soundbox.

With this, the company will empower merchants to accept both mobile and card payments across all Visa, Mastercard, American Express and RuPay networks through its iconic Soundbox with ‘tap and pay’ that will help merchants scale their business.

“Today with Paytm Card Soundbox, we take it to the next level. We have found that merchants and consumers need card acceptance as simply as mobile payments with Paytm QR Code. The launch of Card Soundbox will go a long way in merging the two requirements of merchants – mobile payments and card payments,” said Vijay Shekhar Sharma, Founder & CEO, Paytm.

Paytm was the first company to launch audio-based confirmations with Paytm Soundbox, transforming in-store payments in the country.

Focussed on creating technology-led innovations, the company continues to be the market leader in in-store payments with devices like Paytm Soundbox and Card Machines.

“The Paytm Card Soundbox is yet another innovation that will enable small merchants to provide a seamless digital payment experience to their customers by easily accepting contactless card payments,” said Gautam Aggarwal, Division President, South Asia, Mastercard.

After the recent successful launch of Paytm Pocket Soundbox and Paytm Music Soundbox, with Paytm Card Soundbox, the company is driving further convenience for merchants.

With Paytm Card Soundbox, the company solves two problems for merchants — accepting card payments along with getting instant audio alerts for all payments. The launch of Paytm’s unique device will transform in-store payments by expanding payment acceptance for merchants by combining Soundbox with NFC or contactless debit and credit card payments with mobile payments.

“Audio payment alerts have transformed digital payments in India and enabled many merchants to seamlessly digitise their businesses. Paytm Card Soundbox is India’s first Soundbox that will also accept contactless card payments and would further accelerate cashless transactions in the country,” said NPCI.

The new Soundbox will provide both audio and visual payment confirmation through an LCD display to the merchant and the customer.

“The launch of Paytm Card Soundbox demonstrates the importance of contactless card payments in today’s world. Visa is proud to be part of this innovation, which offers a versatile solution for merchants and aligns with the changing preferences of consumers in India,” said Sandeep Ghosh, Group Country Manager, India and South Asia, Visa.

With built-in ‘tap and pay’ functionality, merchants will be able to accept card payments up to Rs 5,000. The device is powered by 4G network connectivity, providing the fastest payment alerts.

With a 4W speaker, Paytm Card Soundbox enhances the clarity of payment alerts. It also has a long battery life of five days.

“After revolutionising mobile payments by pioneering Soundbox in India, Paytm Card Soundbox will further boost digitisation in the country. It is India’s first Soundbox that also accepts card payments, this would help accelerate the growth of cashless transactions in the country and Amex is happy to be a partner with Paytm on this acceptance growth,” said Anurag Gupta, Vice President & Head – Acquiring & Network Issuing, American Express.

Moreover, the device offers alerts in 11 languages that can be changed by the merchant through Paytm for Business app. Plus, with Paytm Card Soundbox, users with NFC-enabled smartphones can also pay through their phones using the tap feature.

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Impressive Paytm!

Over the last one year, the company’s merchant subscriber base more than doubled to 79 lakh as of June 2023 with its merchant base expanding to 3.6 crore…reports Asian Lite News

India’s leading payments and financial services company Paytm has shown yet another impressive quarterly growth, registering a bumper revenue uptick of 39 per cent YoY, taking its revenue to Rs 2,342 crore in Q1FY24. This was achieved by increase in GMV, merchant subscription revenues, and growth of loans registered on the platform.

Paytm’s EBITDA before ESOP saw a significant improvement of Rs 359 crore YoY to Rs 84 crore, compared to Rs 52 crore in Q4FY23 (excluding the UPI incentive). In Q1FY24, Paytm further grew its contributing profit, up by 80 per cent YoY to Rs 1,304 crore. Driven by the rise in contribution margin and consistent improvement in profitability, EBITDA before ESOP margin also improved to 4 per cent.

Over the last one year, the company’s merchant subscriber base more than doubled to 79 lakh as of June 2023 with its merchant base expanding to 3.6 crore, a robust growth for its pioneering devices like Paytm Sound Box and Paytm Card machines. Contribution margin of the company expanded to 56 per cent this quarter, an increase of 12 per cent point YoY, with increase in net payment margin and growth in loan distribution business.

Its payments services revenue grew 31 per cent YoY to Rs 1,414 crore for Q1FY24.

As a merchant payments leader, Paytm continues to see sustained traction and earns more than Rs 100 to Rs 500 per month per device. Meanwhile, the number of merchant loans distributed grew 141 per cent YoY in Q1 FY 2024, while the value of merchant loans grew 232 per cent YoY to Rs 2,744 crore.

Paytm.

The revenue from financial services offered by the fintech major saw a bumper growth, soaring 93 per cent YoY to Rs 522 crore. With loan distribution forming a core of the company’s aggressive business growth strategy, the value of loans disbursed stood at Rs 14,845 crore, up 167 per cent  YoY.

The number of postpaid loans distributed by Paytm grew 49 per cent YoY, while the value of postpaid loans grew 138 per cent YoY.

Another groundbreaking growth was registered under the personal loans category with Paytm achieving growth of 128 per cent YoY, with the value of personal loans growing 202 per cent YoY to Rs 4,062 crore.

Paytm. (Photo: Twitter/@Paytm)

The total number of unique borrowers who have taken loan through Paytm platform has increased from 49 lakh to 1.06 crore.

With increased customer engagement, its Average Monthly Transacting Users (MTU) for Q1 FY 2024 grew by 23 per cent YoY to 9.2 crore as adoption of mobile payments for consumers in India continues.

Paytm’s active user base continues to present significant upsell opportunities, providing businesses with ample opportunities to monetise. In Q1 FY 2024, Commerce & Cloud revenue grew by 22 per cent YoY to Rs 405 crore.

Furthermore, due to positive EBITDA before ESOP, improvement in working capital, and interest income, its cash balance has increased to Rs 8,367 crore as of quarter ending June 2023, as compared to Rs 8,275 crore as of quarter ending March 2023.

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Paytm saga continues

Driving payment monetisation, Paytm’s subscription devices, Soundbox and PoS machines, continue to see an increased acceptance by merchants….reports Asian Lite News

Leading payments and financial services company Paytm on Wednesday said it achieved a new milestone in merchant payments with 79 lakh devices deployed while the gross merchandise value (GMV) for the Q1 FY24 stood at Rs 4.05 lakh crore, a year-on-year (YoY) growth of 37 per cent.

Driving payment monetisation, Paytm’s subscription devices, Soundbox and PoS machines, continue to see an increased acceptance by merchants.

The company continues to remain the market leader in merchant payments with the number of merchants paying subscription for payment devices has reached 79 lakh as of June 2023, an increase of 4 lakh devices in the month and 11 lakh devices in the quarter that ended on June 30.

Consumer engagement on the Paytm Super App remains high with the average monthly transacting users (MTU) at 9.2 crore, growth of 23 per cent YoY.

With an eye on profitability, the company said, “Our focus over the past few quarters continues to be on payment volumes that generate profitability for us, either through net payments margin or from direct upsell potential.”

Paytm’s credit distribution business, in partnership with large lenders, continues to witness robust growth with total disbursements for the quarter, surging 167 per cent YoY to Rs 14,845 crore ($1.8 billion) with 1.28 crore loans (51 per cent YoY growth) distributed.

“Our focus remains on the asset quality by continuously reviewing with our partners cohort data and tightening credit policy wherever needed proactively. This reflects in the growth of value of loans distributed in the quarter,” said the company.

Paytm currently has seven active lending partners and it aims to onboard 3-4 partners this fiscal.

It announced its loan distribution partnership with Shriram Finance Limited on June 30.

The company also said that due to the earlier mentioned system upgrade, the higher disbursals in June reflects the pent-up demand from April being met in May.

In the results of the last quarter of FY23, Paytm reported a 51 per cent YoY growth in revenue from operations to Rs 2,334 crore, driven by growth in payments and loan distribution business.

The company reported an operating profit for the second straight quarter in Q4FY23. It reported EBITDA before ESOP cost of Rs 234 crore, including the full-year UPI incentive.

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