- Accelerated engagement seen in average Monthly Transacting Users at 64.4 million, and a GMV of Rs 2.5 lakh crore.
NE BUSINESS BUREAU
AHMEDABAD, FEB 5
Fintech major One97 Communications Limited, which owns the brand Paytm, India’s leading digital payments and financial services company, saw its revenue increase 89 per cent to Rs 1,456 crore in the December quarter (Q3) on a year on year basis.
EBITDA losses (before ESOP expense) came down to Rs 393 crore from Rs 488 crore during the same quarter in the previous year. This revenue increase was led by high monetization and growth in merchant payments through MDR bearing instruments, new device subscriptions and loan disbursements.
The company also saw its average Monthly Transacting Users at 64.4 million, and a GMV of Rs 2.5 lakh crore.
Paytm spokesperson said, “Our business is to offer payments for consumers and merchants, and cross-sell high-margin financial services and commerce to them. We acquire customers on our consumer app for bill payments, money transfer and offline merchant payments, and offer them Paytm Payment Instruments (Paytm Wallet, Paytm Payments Bank account, and Paytm Postpaid) and Paytm UPI. We acquire merchants for QR payments, EDC and Soundbox devices and Payment Gateway (for online merchants). We use insights from our platform to offer various financial products to our customers and merchants. We also provide high-margin Commerce and Cloud Services to our merchants to help them enable commerce using the Paytm App.”
The company’s revenue from payment services to consumers was up by 60% at Rs 406 crore, while the revenue from payment services to merchants was up by 117% to Rs 586 crore. The cloud and commerce services also saw its revenue jump by 64% to Rs 339 crore.
Rapid Scale up of Financial Services Operating on Platform Leverage
A major part of the company’s Q3 results was seen in its financial services play ramping up. The company disbursed 4.4 million loans (401% y-o-y growth) aggregating to a total value of Rs 2,181 crore (366% y-o-y growth).
The company’s credit business spread across three main verticals — Paytm Postpaid (Buy Now, Pay Later), merchant loans and personal loans, saw rapid scale up. Number of Postpaid Loans disbursed grew 407% Y-o-Y in Q3 FY 2022, while the value of Postpaid Loans grew 408% Y-o-Y.
The number of Personal Loans disbursed grew 1,187% Y-o-Y in Q3 FY 2022, while the value of Personal Loans grew 1,925% Y-o-Y. We see a significant potential to cross-sell as over 50% of personal loans were disbursed to our existing Paytm Postpaid users. Average ticket size ranged from ₹80,000-90,000 with average tenure of 12-14 months.
Additionally, the number of Merchant Loans disbursed grew 38% Y-o-Y in Q3 FY 2022, while the value of Merchant Loans grew 128% Y-o-Y. More than 25% of loans were disbursed to new to credit borrowers. Average ticket size continues to increase with scale, now at ₹120,000-140,000 with average tenure of 12-14 months. Repeat loans have seen a healthy take up, with 25% of merchants having taken a loan more than once.
Contribution Profit Jumps by 6X
The company has seen a step-change in its contribution profit between FY 2021 and FY 2022. The contribution profit for Q3 FY 2022 at ₹454 Cr represents a 560% Y-o-Y growth. The company’s expenses as a percentage of revenues are also coming down sharply.
