Here is how fintech pioneer Paytm's leadership in merchant payments is driving strong business growth

Paytm, by virtue of being the pioneer of mobile payment solutions in the country, is driving robust growth momentum. With digital payments becoming a new normal, Paytm's innovative and iconic products are being widely accepted and trusted by crores of merchants in the country and driving its strong growth trajectory.

This is reflected in the surging revenue growth of the fintech giant, which is scaling crucial milestones every quarter.

Paytm achieved operational profitability for the first time in Q3FY23, and further strengthened it in Q4FY23. In the recent March quarter, Paytm's revenues grew 51 per cent Y-o-Y to Rs 2,334 crore driven by high merchant subscription revenues and the growing scale of its loan distribution business. In FY23, the payment solutions provider's revenue from operations jumped 61 per cent Y-o-Y to Rs 7,990 crore.

Paytm's army of 79 lakh merchants that pay subscriptions for their payment devices like Paytm Soundbox and Paytm Card Machines have aided the company in achieving aggressive growth.

The average Monthly Transacting Users stood at 9.2 crore, growing by 23 per cent Y-o-Y in Q1 FY24, as the adoption of mobile payments for consumers and merchants in India continues.

With the rise in monthly transactions, Paytm's Gross Merchandise Value (GMV) also increased handsomely by 37 per cent Y-o-Y to Rs 4.05 lakh crore for Q1 FY24. The numbers reflect the increasing acceptance of Paytm's QR and Paytm Soundbox.

Adding to it, incentives from the government for UPI and subscription revenue from merchants are also driving the company's payments business. Paytm received a UPI incentive of Rs 49 crore in the March quarter from the government. Total UPI incentive for FY23 stood at Rs 182 crore, which grew 102 per cent Y-o-Y.

The fact that Paytm has made significant investments towards sales manpower, improvement of technology platform, marketing spends, etc ensures that its strong growth momentum will continue.

Paytm founder and CEO Vijay Shekhar Sharma believes that payments and financial services distribution business are the growth drivers of the leading fintech company. Paytm's next milestone is to make the company free cash flow positive in the near future.

“I am very proud of our team which has delivered such amazing results through their clinical focus on execution and quality business metrics. Our focus on quality revenues has led to more rupee to the bottom-line and our incremental business continues to generate better margins,” Sharma said in a letter to shareholders.

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