In a long-awaited move, Paytm’s share price surged by 5 percent amid news that it had acquired approval to join the UPI as a Third-Party Application Provider operating under the multi-bank model.
The National Payment Corporation of India’s approval for Paytm to operate as a TPAP is a critical milestone. The move was anticipated by D-street analysts. In its UPI business, Paytm will work with Axis Bank, HDFC Bank, State Bank of India Ltd, and Yes Bank, four large banks.
The business of UPI will be covered for the payment service provider; however, Yes Bank will be the merchant acquiring bank for both current and new UPI merchants. Paytm’s share price has declined significantly more than 50% following the RBI’s regulatory actions.
The actions against Paytm were big and hefty, with the RBI imposing broad-based restrictions against its associate entity Paytm Payments Bank Limited.
As a result of the RBIs actions, following March 15th 2024, no Paytm Payments Bank Limited wallet or account accepted new deposits. Furthermore, on February 23rd 2024, the RBI commanded the NPCI to assess One97 Communication Sarid’s application for TPAP status to determine if Paytm could continue to use UPI in good standing.
At 11:45 a.m. Paytm’s shares were trading at 5% upper circuit, reaching ₹370.70.
