After 8-month freeze, Paytm can now onboard new UPI users
Paytm, one of India's leading financial services companies, has received the green signal from the regulator to resume onboarding of new Unified Payments Interface (UPI) users. The move comes after an eight-month-long period, during which, most of its operations were limited. The National Payments Corporation of India (NPCI), the regulator for UPI, gave the approval on Tuesday.
Paytm's market share impacted by central bank restrictions
With over 15 billion monthly transactions, UPI is the backbone of India's online payments industry. Most of the UPI transactions are handled by Walmart-owned PhonePe and Google Pay, which make up for roughly 87% of the total. Paytm's monthly transacting user base plummeted from 100 million in December to 68 million last month, largely due to the RBI's restrictions on onboarding new users. Consequently, its market share in the UPI space has dropped from 13% to 8%.
Paytm's Q3 revenue rises despite year-on-year decline
Analysts have called the regulatory approval a "significant" event that could trigger a revival in Paytm's user growth. Despite the regulatory challenges, Paytm posted a quarterly revenue of $197.4 million for the September-ending quarter, up from $178.6 million in the last quarter. However, it is still a 34% year-on-year decline from $299.5 million. The company's profit for the quarter increased to $110 million, mainly due to a one-time gain of $160 million from selling its entertainment ticketing business to Zomato.
