One97 Communications (Paytm) witnessed a further decline in its shares on March 14, dropping over 3 percent as the deadline for Paytm Payments Bank services approaches on March 15.
This dip follows the recent partnership between the State Bank of India (SBI) and Paytm for consumer UPI payments, signaling Paytm’s efforts to navigate regulatory changes and sustain its UPI operations.
Since the Reserve Bank of India’s action against Paytm Payments Bank Limited (PPBL) on January 31, Paytm has been striving to secure partnerships and transition into a third-party application provider (TPAP), akin to its competitors PhonePe and Google Pay.
Reports suggest that Paytm is exploring collaborations with four banks to facilitate UPI transactions and is aiming to attain TPAP status before the looming March 15 deadline.
As of 9:43 am, Paytm shares were trading at Rs 338.95 on the National Stock Exchange (NSE), marking a 3 percent decline from the previous close. Over the past six months, the stock has plummeted by nearly 60 percent, reflecting investor concerns amid regulatory uncertainties.
Despite the recent downturn, Paytm’s stock is trading 9 percent above its 52-week low of Rs 318 registered on February 16. However, compared to the closing price of Rs 761.20 on January 31, the stock has witnessed a substantial decline of over 54 percent.
Recent reports indicate that Paytm had previously partnered with Axis Bank, Yes Bank, and HDFC Bank for TPAP arrangements. Currently, it is in discussions with Axis, Canara, Yes, and Kotak Mahindra Bank to transition merchant accounts from payments bank to ensure uninterrupted UPI services.
The National Payments Corporation of India (NPCI) is collaborating with banks to expedite the TPAP process by March 15, a regulatory requirement for major UPI players. The migration aims to prevent disruptions and seamlessly transition customers and merchants from PPBL to new bank partners.
SBI’s collaboration with Paytm as the fourth bank for UPI business underscores the evolving landscape of digital payments and the strategic importance of partnerships in sustaining operations amidst regulatory changes.
