Paytm logo and a smartphone with the app is seen here.
Credit: Reuters File Photo
Amid repeated departures of senior executives, Paytm Payments Bank Limited (PPBL), under fintech firm Paytm, announced that it has migrated to Euronet Services India for its bill payment business.
The announcement comes days after PPBL shifted its retail point of sales business to RBL Bank while it chose Axis Bank for PPBL's settlement business for merchant payments.
Bill payments on PPBL fell to 27 lakh from 160 lakh in January, a decline of 83 per cent.
A payment technology firm, Euronet is a globally recognized financial services provider which undertakes maintenance and upgrade of backend settlement systems for several digital payment modes in India. Economic Times quoted a source with knowledge of the development saying, “Since Paytm Payments Bank was asked to stop offering services, they had to migrate to someone else, and Euronet has taken over the business.”
According to Bharat Billpay, which is the backend engine for all major bill payments in the country, Euronet settled close to 190 lakh consumer-facing bill payments in March 2024, up fourfold from 46 lakh in January, buoyed by the pact with Paytm.
Bharat Billpay is a subsidiary of the National Payments Corporation of India.
Even as Paytm's CEO Vijay Shekhar Sharma said last month that the board of PPBL is independent to make its own decisions, constant enquiries into Paytm Payments Bank business has impacted Paytm. One97 Communications (OCL) owns a 49 per cent stake in PPBL.
Another source aware of PPBL's collaboration with Euronet said, “As a settlement platform, banks make a commission for every bill payment done through Bharat Billpay; for Paytm, that revenue source will get reduced since it will only make a small commission as a sourcing entity for the bill payment transaction.”
The source further added, “As a bank or a registered operating unit, you get a share of the commission and with crores of transactions settled every month, the share becomes sizable.”
Last week, One97 Communications president and chief operating officer Bhavesh Gupta resigned from the company. Verticals, headed by him, were adversely impacted by the RBI's ban on Paytm Payments Bank (PPBL) from carrying on new transactions, since January. The ET report further said that two chief business officers of the company have also reportedly resigned.
In April, then-CEO and managing director of PPBL Surinder Chawla also resigned while Paytm's shares saw a constant drop for weeks.
In March this year, the Financial Intelligence Unit (FIU) fined PPBL with Rs 5.49 crore, on grounds that the Paytm subsidiary’s users engaged in a number of illegal activities, including organising and facilitating online gambling, it said in a press statement.