Paytm shares rise 3% on NPCI approval for user migration to PSP banks handles

Shares of One97 Communications, the parent of Paytm, surged as much as 3.3% to hit an intraday high of ₹404.55 apiece on the BSE, a day after the company received approval from the National Payment Corporation of India (NPCI) for starting the user migration to new payment system provider (PSP) handles with immediate effect.

The scrip opened higher at ₹400.45, up 2.3%, as against the previous closing price of ₹391.35. At 11:23 am, the share price of the payment aggregator was trading 0.27% higher at ₹392.40. This was in line with the broader BSE Sensex, which was trading 375.20 points or 0.51% higher at 73,318.88. 

Paytm’s market capitalisation stood at ₹24,983.21 crore with 87,602 shares exchanging hands on the BSE, as against the two-week average of 1.95 lakh shares. The company hit a 52-week high of ₹998.30 on October 20 last year, whereas a 52-week low of ₹318.35 on February 16, this year.

In the past three months, six months and one year, the company’s stock has declined 47.90%, 58.53% and 38.95%, respectively.

“Following NPCI's approval on March 14, 2024, to onboard OCL as a Third-Party Application Provider (TPAP) on the Multi Payment Service Provider API Model, Paytm has expedited the integration with Axis Bank, HDFC Bank, State Bank of India (SBI), and YES Bank. All four banks are now operational on the TPAP, streamlining the process for Paytm to shift user accounts to these PSP banks,” the company said in a release. According to the company, Paytm has started transitioning its users to these banks.

“We are committed to growing the UPI ecosystem in partnership with NPCI to every nook and corner of India,” a company spokesperson said.

Last month, Paytm received approval from NPCI to participate in UPI as a third-party application provider (TPAP) under the multi-bank model.

The development came after the Reserve Bank of India last month ordered Paytm Payments Bank, an associate entity of Paytm, to stop accepting fresh deposits in its accounts and wallets from March 15. Last week, Surinder Chawla resigned as Managing Director and CEO of Paytm Payments Bank (PPBL).

In February, RBI governor Shaktikanta Das said the banking regulator gave ample time to Paytm Payments bank to comply with regulations and business restrictions were imposed only when the entity did not listen to constructive engagement.

“We give sufficient time to every RE to comply with the requirements. Sometimes it may look more than sufficient. We are a responsible regulator. If everything has been complied with, then why should we act," Das had said.

The supervisory action on Paytm was taken after persistent non-compliance and months and years of bilateral engagement with the company, said RBI deputy governor Swaminathan J.