MC Exclusive| Paytm partnership going extremely good; 1.2 bn transactions every month, says Yes Bank CEO Prashant Kumar

Prashant Kumar, MD and CEO, YES BANK

YES Bank managing director and chief executive officer (CEO) Prashant Kumar on May 24 said the bank is handling almost 1.2 billion transactions on behalf of Paytm every month, after the recent partnership with the fintech company, which, early this year, faced regulatory wrath on its payments bank unit -- Paytm Payments Bank Ltd (PPBL) .

“First, we feel happy that when there was a problem in the system, we were able to take care of that. That was one satisfaction for us. I think the entire flow of Paytm transactions is happening through us without any problem. We are handling almost 1.2 billion transactions on behalf of Paytm every month,” Kumar said in an exclusive interview with Moneycontrol.

The RBI cracked the whip on PPBL on January 31, imposing severe business restrictions citing  a long history of non-compliance with prudential regulations by the company’s promoters.

After this, on March 14, Paytm informed the exchanges that the National Payments Corporation of India (NPCI) has granted approval to One97 Communications Limited (OCL) to participate in UPI as a Third-Party Application Provider (TPAP) under the multi-bank model.

Paytm further said four banks - Axis Bank, HDFC Bank, State Bank of India and  YES Bank - shall 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 exchange filing said.

On March 15, Moneycontrol reported that Yes Bank and Axis Bank went live on Paytm app. Yes Bank has gone live with a closed user group of users with @ptyes handle and Axis Bank has gone with @ptaxis handle.

Last month, Kumar, during a post-result press conference, said that the bank has registered around 5 million monthly transactions on Unified Payments Interface (UPI), since its partnership with Paytm.

“Before the partnership with Paytm, we were seeing around 3.3 million UPI transactions and now we are seeing 5 million monthly transactions on UPI,” Kumar had said.

The bank, Kumar said, has around 55 percent market share in UPI transactions by merchants. “Our market share in merchant UPI transactions is around 55 percent. This gives us an advantage on fee income and we may look at cross-selling products to them in future,” he said.

The bank reported a net profit of Rs 451 crore for the January-March quarter of financial year 2023-24, which marks a 123 percent jump, compared to Rs 202 crore in the year-ago period.

Yes Bank's gross non-performing asset (NPA) stood at 1.7 percent, down from 2.2 percent in the same quarter last year. On the other hand, net NPA for the quarter stood at 0.6 percent, improving from 0.80 percent on a year-on-year basis. Gross slippages for Q4FY24 stood at Rs 1,356 crore versus Rs 1,233 crore in Q3FY24.

The net interest income (NII) of the lender came in at Rs 2,153 crore, increased marginally by 2 percent, compared to Rs 2,105 crore in the corresponding quarter of the previous fiscal.