“Paytm* is like an early-stage startup now, but with a lot of money,” said a former Paytm executive. For a company that poured billions of dollars into becoming India’s payments leader, starting from scratch is a galling proposition.

The highs of demonetisation in 2016 set it up to become the country’s number one payments company. In the year ended March 2018, Paytm was firing on all cylinders. It had built a 10 million-strong merchant network, boasted 250 million users—80 million of which transacted monthly—and $20 billion in gross transaction value value Entrackr Paytm claims 2.5X jump in GTV in FY19; records 5.5 Bn transactions Read more . All of this culminated in annual revenue growth of 398%. The consolidated operational revenue for the Paytm Group, or One 97 Communications Ltd, was Rs 3,058 crore ($416 million). Paytm’s wallet and QR code business were on a tear.

With deep-pocketed backers such as Ant Financial—the world’s largest fintech and the crown jewel of Chinese conglomerate Alibaba—and Japanese VC SoftBank in its corner, payments was Paytm’s game to lose. Warren Buffett-led Berkshire Hathaway would soon get on the Paytm bandwagon, a further indication of faith in Paytm’s promise.

Cut to 2020, and all that promise has largely failed to materialise. Paytm’s payments core looks depleted. It is no longer number one, or for that matter even number two when it comes to Unified Payments Interface Unified Payments Interface UPI Real-time, mobile-based payments that allowed users to pay anyone using any payment app (UPI) transactions. Instead, with just 13% of the UPI market, according to a payments executive with knowledge of official data, Paytm was a distant third behind Google Pay (41%), homegrown rival PhonePe (35%) as of date. Even late entrant Amazon Pay with a 6% share is snapping at Paytm’s heels.

According to multiple current and former Paytm employees, its GTV has begun to stagnate. While it grew to $50 billion in the year year Economic Times Paytm hits $50 billion GTV in FY19 Read more ended March 2019, they claim that its GTV was just $60 billion the following year even as it set a $100 billion target internally. In an emailed response, a Paytm spokesperson, while not denying the $60 billion figure, claimed the company’s current GTV was “more than $100 billion”.

Current and former employees also claim that the number of users who transact each month on the platform has also fallen to less than 60 million. Paytm did not specifically address the veracity of this number, but claimed its annual transacting user base was 150 million.

AUTHOR

Arundhati Ramanathan

Arundhati is Bengaluru-based. She is interested in how people use money in the digital age and how new economies will take shape based on that interaction. She has spent over 10 years reporting and writing on various subjects. Previous stints were at Mint, Outlook Business and Reuters.

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