One 97 Communications, which operates the PayTM payments platform in India, revealed details of its October performance late on Sunday, hours before trading resumed in its shares after a volatile first day on Thursday.
The company’s shares had fallen by a whopping 27% on day 1, wiping out around Rs 38,000 cr of investor wealth in terms of a decline in the value of its shares.
The company is one of the pioneers in the field of online mobile recharges, and soon expanded the payment offering to peer-to-peer money transfers, and eventually to merchant and point-of-sale transactions.
Flush with VC funds, the company also tried to give Amazon and Flipkart a run for their money by floating an online market place, but failed to retain consumer interest beyond the short term.
For now, the company’s primary business is in payments processing, with loan origination also playing an increasingly important role for the company, particularly from a profitability angle.
OCTOBER PERFORMANCE
In an operating update issued late on Sunday, the company said both loan origination as well as payments processing continued to show growth during October.
The amount of money paid to merchants and other commercial establishments using the PayTM platform rose to Rs 832 cr in October, compared to a monthly average of Rs 652 cr for the preceding three months (July-September 2021).
Many customers use PayTM and similar apps to make payments at offline stores, partly due to convenience and partly because of rewards such as cash-backs.
October also saw the number of merchants with PayTM payment devices increased by 0.1 million to 1.4 million. The number had jumped by around 0.4 million in the preceding three months. Like loan origination, PoS devices are also a relatively new area of activity for the company.
Loan origination, a potentially strong profit driver of the future, also saw good growth during October, according to the company’s update.
The company helps originate loans for lending partners, such as banks.
During October, it helped originate 1.3 million loans, compared to 2.8 million for the preceding three-month period.
The total value of the loans it helped originate during October was Rs 627 cr ($84 million), which gives an average loan size of around Rs 4,823 or around $65.
“..our lending business has seen good adoption since launch of products such as Paytm Postpaid and personal loans with financial institution partners… The lending business, continued to show very strong growth as a result of rapid scale up of all of our lending products, including Postpaid, consumer loans and merchant loans,” the company said.
The number of monthly transacting users, or accounts that carry out at least one successful transaction during the month, also increased to 63 million or 6.3 cr, up from an average of 57 million during the preceding three months.
