Paytm Narrows Q1 Loss to Rs 358 Cr, Records Impressive 39% Revenue Jump
- ByStartupStory | July 22, 2023
Paytm’s parent company, One97 Communications, revealed a narrowed loss of Rs 358.4 crore for the first quarter, compared to a loss of Rs 645.4 crore in the same period last year. However, the loss has increased from Rs 168 crore in the preceding March quarter. The company’s revenue from operations during the reported quarter increased by 39.4% to Rs 2,341.6 crore from Rs 1,679.6 crore in the June 2022 quarter.
The merchant payments volume (MPV) for Paytm witnessed a 37% year-on-year growth, reaching Rs 4.05 lakh crore in the April-June quarter of FY2023-24. The EBITDA before ESOP margin stood at 4% due to a consistent improvement in profitability, driven by strong revenue growth, increasing contribution margin, and operating leverage.
Paytm’s lending business continues to flourish, with loans disbursed via the platform amounting to Rs 14,845 crore in the first quarter, marking a substantial 167% year-on-year growth. Additionally, the net payment processing margin for Paytm demonstrated a positive trend, ranging from 5-8 basis points, supported by an increase in the gross merchandise value (GMV) of non-UPI instruments (EMI and Cards) and lower interchange costs for the wallet.
Providing an update on the RBI’s bar on onboarding new customers, Vijay Shekhar Sharma, Chairman, Managing Director, and CEO of Paytm, stated that the bank has submitted a compliance report to the banking regulator, which is currently under review. During FY 2022, RBI had directed Paytm Payments Bank (PPBL) to halt new customer onboarding from March 1, 2022. In FY 2023, RBI appointed an external auditor to conduct a comprehensive systems audit of PPBL. Subsequently, on October 21, 2022, PPBL received the final report from RBI, outlining the need for strengthening IT outsourcing processes and operational risk management, including KYC, at the Bank. The bank has submitted the compliance to these instructions of RBI and is awaiting further review by RBI.
Despite facing some challenges related to indirect costs and the regulatory environment, Paytm remains committed to expanding its services and innovative solutions. The company’s consistent growth and strong financial performance have positioned it as a prominent player in the digital payment and financial services sector.
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