Paytm focusing on consumer payments business: CEO

Paytm founder Vijay Shekhar Sharma

Fintech firm Paytm’s immediate priority is to invest in its consumer payments business in an effort to recover lost user base following regulatory actions by the RBI, a top company official said on Sunday.

The RBI had restricted Paytm Payments Bank from accepting deposits or facilitating credit transactions in customer accounts, including prepaid instruments and wallets.

In August, Paytm sold its ticketing business to foodtech company Zomato for Rs 2,048 crore to sharpen its focus on core operations — payments and financial services distribution.

"Payments remain our primary business, and the merchant side continues to be strong. However, we lost a significant consumer base due to regulatory constraints. Moving forward, we aim to reinvest in the consumer payments business area," Paytm CEO Vijay Shekhar Sharma said during an interactive session organised by the Calcutta Chapter of Young Indians, the youth wing of the Confederation of Indian Industry (CII).

Consumer payments encompass UPI payments, while the merchant side involves QR code transactions.

According to available company data, there was a sudden decline in monthly transactional user (MTU), dropping from 10.4 crore in January to 7.7 crore in May. The figure stood at 7.8 crore in June.

Conversely, on the merchant side, Paytm saw incremental growth, with the number of merchants increasing from 79 lakh in the June 2023 quarter to 109 lakh in the June 2024 quarter, it showed.

Sharma said the company is tapping into the Third-Party Application Provider (TPAP) business model.

It involves offering digital payments services to users via various platforms or applications. TPAPs collaborate with banks and financial institutions to facilitate transactions, providing a user-friendly interface for services such as UPI payments, bill payments and other financial transactions.