Paytm app is seen on a smartphone.
Credit: Reuters Photo
Among the businesses profiting from the Paytm turmoil are PhonePe, BHIM, and Google Pay. The Reserve Bank of India's decision to prohibit Paytm from accepting deposits, FASTag, or credit transactions starting on February 29 has rattled Paytm-affiliated retailers. But at the same time, Paytm's debacle is helping its competing apps, be it PhonePe, GPay or the BHIM UPI app.
In India, Paytm has dominated digital payments. However, since the crackdown, the value of the company has dropped by $2.3 billion due to a 39% decline in its stock.
Per a Moneycontrol report with statistics given by the app intelligence firm Appfigures, PhonePe saw 2.79 lakh Android downloads on February 3. This was a 45 per cent weekly increase from the 1.92 lakh Android downloads on January 27.
According to the data, the app's Android downloads increased by 24.1 percent to 10.4 lakh from 8.4 lakh downloads over the same period last week (Jan 24-Jan 27).
Similarly, the BHIM app showed a 50% spike in Android downloads to 5.93 lakh from 3.97 lakh downloads for the same period last week.
On the other hand, Google Pay experienced a very slight rise in the number of downloads for its Android app. From 1.04 lakh downloads on January 27 to 1.09 lakh downloads on February 3, the firm observed a weekly growth of 4.9%.
Following the RBI's order to stop accepting new deposits and credit transactions as of February 29, 2024, Paytm Payments Bank attempted to reassure its clients on January 2.
Paytm contacted its users by SMS and email in response to directives from the central bank. Framed as an "important update," the correspondence made it clear that customers' funds are safe with the bank.
The digital wallet business of Paytm might not be able to continue operating beyond February 29, 2024, unless the RBI grants permission for the license to be transferred to parent company One 97. Concerns concerning Paytm's brand value and the startup environment as a whole have also been brought into question by the incident.