India’s leading financial services company Paytm has received regulatory approval to resume adding new UPI payment users after an eight-month restriction on many of its operations.
Processing more than 15 billion transactions per month, UPI dominates online payments in India. Walmart-owned PhonePe and Google Pay process about 87% of UPI transactions, while Paytm’s market share has fallen from 13% to 8% following central bank restrictions this year.
The Reserve Bank of India ordered Paytm earlier this year to suspend many of its affiliated payments banks’ operations due to repeated rule violations. NPCI, the regulator that oversees UPI, approved Paytm’s application on Tuesday.
Analysts at Bernstein and Goldman Sachs said the approval is a “significant” development that will help revive Paytm’s transaction user growth. Paytm’s monthly transaction users decreased from 100 million in December to 68 million as of last month.
Paytm on Tuesday reported revenue of $197.4 million for the quarter ending September, up from $178.6 million in the previous quarter but down 34% from $299.5 million a year ago. Quarterly profit rose to $110 million after factoring in a one-time gain of $160 million from the sale of its entertainment ticket business to Zomato.
