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Paytm’s loss widened even as revenue declined by 36% year-on-year as the once-poster star of Indian startup ecosystem continues to grapple with the Reserve Bank of India’s clampdown that significantly curtailed the payments bank business unit.
The Noida-headquartered firm’s loss more than doubled to $100 million in the quarter ending June, it disclosed Friday. The firm’s revenue shrank to $179.5 million, down from $280 million in the same quarter last year and $271 million in the quarter ending March in 2024.
The decline in revenue follows the Reserve Bank of India ordering Paytm earlier this year to cease most operations at Paytm Payments Bank, an affiliate of the financial services firm that processed much of its transactions. This is the first quarter where the full impact of RBI’s clampdown is visible.
Paytm’s loss in the quarter ending June last year stood at $42 million, and $65.8 million in the quarter ending March this year.
Paytm pioneered the mobile payments push in India, courting hundreds of millions of Indians to its wallet app and enabling many of them to do their first digital transactions. But the fortune of the firm has dwindled in recent years amid growing competition from Walmart-backed PhonePe and Google Pay.
PhonePe and Google Pay process more than 86% of all transactions on UPI, a state-backed interoperable payments network. UPI has become the most popular way Indians transact online, processing more than 11 billion transactions each month. The surge in UPI’s popularity has hurt the relevance of the wallet business and consumer’s reliance on using card networks operated by Visa and Mastercard.
Paytm said it’s continuing to see a rebound in its merchant business, which it said is “demonstrating our path to recovery.”
A company spokesperson added: “This also indicates the continued confidence of our merchant partners and consumers on our platform, and we are grateful for the trust of our stakeholder.”
