Paytm's lending biz posts solid growth; loans disbursed jump 471pc in April-May
Digital payments platform, operated by One97 Communications, on Wednesday said it disbursed 5.5 million loans in April and May. This is 471 percent, or almost six times, more than it did in the comparable period a year ago.
Aggregate loan value for the period was $476 million in April and May, up 829 percent from last year, with ticket sizes increasing across the board, the Noida-based company added.
Paytm has been focussing on growing its lending business for the past couple of years amid rising competition in the digital payments space, which has been especially upended by UPI (Unified Payments Interface), as well as growing appetite in India for small sachet loans and personal loans.
Its shares were up ~2.20 percent in midday trading.
Following Paytm's fourth quarter and full-year results, several brokerages including its IPO bookrunners JPMorgan have lauded the growth in its lending business.
JPMorgan said in a note that the improvement in Paytm's profit margins over the last two quarters has set the stage for "operating leverage from the second quarter of FY 2023 onwards."
Paytm reported losses for the last 11 years since its inception due to high customer acquisition costs. However, CEO and founder Vijay Shekhar Sharma has said he expects the company to hit operating EBITDA breakeven in the next six quarters.
Merchant payment volumes for April and May increased 105 percent to $26.2 billion, the company said in a press release, bolstered by its offline payments business which has been deployed on 3.4 million devices at merchant stores across the country.