Paytm's Quarterly Loss Widens Amid Regulatory Impact

One97 Communications, owner of Paytm, reported a widened loss of Rs 840 crore in Q1 due to restrictions on Paytm Payments Bank by RBI. The company's revenue fell by 33.48%, primarily attributed to disruptions in business operations and regulatory constraints on products like Wallet, leading to a reduction in merchant base and GMV.

Fintech firm One97 Communications, the parent company of Paytm, reported a net loss of Rs 840 crore for the quarter ended June 30, a significant increase from Rs 358.4 crore a year ago. The plunge is primarily due to the continued impact of restrictions placed on Paytm Payments Bank Ltd. (PPBL) by the Reserve Bank of India (RBI).

According to the company's regulatory filing, Paytm's consolidated revenue dropped by 33.48 percent to Rs 1,639.1 crore from Rs 2,464.2 crore in the same period last year. A company spokesperson attributed the widening loss and revenue decline to disruptions caused by RBI's prohibition on PPBL from accepting deposits, credits, or top-ups in any customer accounts, including wallets and FASTags, effective March 15.

Highlighting the impact, the spokesperson mentioned that the merchant base and Gross Merchandise Value (GMV) have witnessed a significant decline. GMV fell by 9.1 percent on a quarter-on-quarter basis, although it saw a 5 percent year-on-year increase to Rs 4.3 lakh crore. Despite a 27 percent YoY jump in GMV from continued business to Rs 4.26 lakh crore, the monthly transacting users dropped by 15 percent YoY to 7.8 crore. The company, however, expects an improvement in its operating metrics and cost optimization in the upcoming quarters.