Indian digital payment giant Paytm has announced a strategic shift, reducing the disbursement of loans below 50,000 rupees ($600.14) following recent regulatory changes. This move is expected to result in a substantial 40%-50% decline in loan volumes through its post-paid product.
Paytm’s President and COO, Bhavesh Gupta, highlighted plans to focus on higher-value loans for lower-risk, credit-worthy customers. Despite the adjustment, Paytm anticipates minimal impact on revenue growth.
The decision aligns with the Reserve Bank of India’s recent tightening of norms for personal loans and credit cards, reflecting a broader industry response to evolving regulations.
Paytm aims to maintain its growth trajectory by diversifying its loan portfolio and expanding its partnerships with both banks and non-banking financial companies (NBFCs).
During the September quarter, Paytm witnessed a significant surge in loan distribution, doubling in value to 162.11 billion rupees ($1.95 billion), contributing to a substantial 64% rise in financial services revenue.
The company remains resilient in navigating the evolving landscape of digital finance in India.