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Paytm, a leading Indian financial services company, has received regulatory approval to resume adding new UPI payments users, after imposing eight-month restrictions on many of its operations.
UPI, which processes more than 15 billion monthly transactions, dominates online payments in India. Walmart-owned PhonePe and Google Pay process about 87% of UPI transactions, while Paytm’s market share shrank from 13% to 8% following central bank restrictions this year.
The Reserve Bank of India ordered Paytm to suspend several companies in its payments bank early this year for repeated violation of rules. NPCI, the regulatory body that oversees UPI, approved Paytm’s application on Tuesday.
Analysts at Bernstein and Goldman Sachs said the approval is a “significant” development that would help revive Paytm’s transaction user growth. Paytm’s monthly transaction users fell to 68 million as of last month from 100 million in December.
Paytm on Tuesday reported revenue of $197.4 million in the quarter ended September, up from $178.6 million in the previous quarter but down 34% year-on-year from $299.5 million. Earnings in the quarter rose to $110 million after accounting for a one-time gain of $160 million from the sale of its entertainment ticketing business to Zomato.
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