Paytm reported on Friday (July 19) that its operating revenue fell again in the quarter ended June as it continued to grapple with regulatory issues.
FinTech India’s operating income for the quarter was about Rs 15 billion, down from Rs 19.8 billion in the previous quarter and Rs 23.4 billion in the same period a year earlier, according to Friday’s earnings release.
“The full financial impact of the recent disruptions was visible during the quarter,” Paytm said in a cover story on its website. “With positive signs visible across the board — growth in merchant payment operating metrics, gross merchandise value (GMV), accelerated merchant reactivation and a growing merchant base, coupled with our continued focus on cost optimization — we remain optimistic about our revenue and profitability growth.”
Paytm has been struggling since January, when India’s banking regulator suspended operations at Paytm Payments Bank — which processes most of Paytm’s payments — after an audit revealed “persistent non-compliances and ongoing material oversight issues.”
The move by the Reserve Bank of India (RBI) follows two years of warnings about questionable ties between Paytm and its banking division.
In a press release Friday, Paytm said its latest quarterly financial results were in line with the guidance the company provided during the previous quarter and showed improvement in key metrics.
Paytm reported that new merchant sign-ups returned to January 2024 levels, average daily gross merchandise value (GMV) improved during the quarter and approached January 2024 levels, and overall GMV has grown month-on-month.
The company also said that its monthly transacting user (MTU) base was stable at the end of June and that Paytm expects further growth in its MTU base if it gets permission to onboard new Unified Payments Interface (UPI) consumers.
“We are seeing improvement in merchant operating metrics and stability in our consumer base, indicating our path to recovery,” a Paytm spokesperson said in the release. “This also demonstrates the continued trust our merchant partners and consumers have in our platform, and we are grateful for the trust our stakeholders have placed in us. With Q1 reflecting the full impact of the recent disruptions, we are confident in our trajectory towards sustained growth going forward.”
