The deadline provided by fintech giant Paytm to address operational hurdles hindering its lending operations and resume the sanctioning of new loans is set to conclude on February 14.
During a company conference call on February 1, One97 Communications President and Chief Operating Officer Bhavesh Gupta indicated a temporary halt in issuing new loans to address operational challenges stemming from RBI restrictions on Paytm Payments Bank Limited (PPBL). The RBI directive, issued on January 31, mandated PPBL to cease accepting deposits or top-ups in various customer accounts and instruments by the end of February.
Although Paytm's lending business is independent of PPBL, approximately 10-15 per cent of Paytm merchants, totaling around 60,000-70,000 merchants, have autopay mandates established through their PPBL accounts. To prevent repayment disruptions, Paytm must transition these repayments linked to PPBL to other banks.
Gupta said, "We will not be originating loans for maybe a couple of weeks before we solve for the operational challenges, and then we go back to normal."
In the December quarter, Paytm disbursed loans amounting to Rs 15,535 crore, covering merchant loans, personal loans, and postpaid loans. The number of unique users availing loans through Paytm surged by 44 lakhs over the past year, reaching 1.25 crore.
In December 2023, Paytm allocated Rs 3,579 crore for merchant loans, Rs 4,460 crore for personal loans, and Rs 7,496 crore for postpaid loans.
An email inquiry sent to Paytm for further clarification remained unanswered at the time of reporting.
(With PTI inputs)
