According to a report by Bloomberg, The market share of Paytm in India’s online payment sector has declined for the fourth consecutive month. This decline comes as the fintech company struggles to recover from the Reserve Bank of India’s (RBI) directive to its affiliate, Paytm Payments Bank, to cease operations. Data from the National Payments Corporation of India reveals that Paytm’s share of total UPI transactions dropped to 8.1% in May from 13% in January. Meanwhile, PhonePe maintains its position as the most popular payment app with a 49% market share, followed by Google Pay at 37%. Since the RBI’s order, Paytm’s shares have plummeted by approximately 55%.
The report also highlights that Paytm Payments Bank, despite being part of Paytm’s founder and CEO Vijay Shekhar Sharma’s fintech empire, is not directly controlled by Paytm. In response to the regulatory setback, Sharma has collaborated with leading Indian banks such as Axis Bank Ltd., HDFC Bank Ltd., and State Bank of India Ltd. to facilitate instant money transfers previously handled by Paytm Payments Bank.
Sharma acknowledged the near-term financial impact on Paytm’s revenue and profitability due to business disruptions in the last quarter. This statement was made in Paytm’s recent earnings filing, as reported by Bloomberg.