This transition follows PPBL’s recent relocation of its retail point-of-sale activities to RBL Bank and its merchant payment settlement services to Axis Bank
Following the directive for Paytm Payments Bank to cease its services, they were compelled to seek an alternative
Under this collaboration, bill payments facilitated by PPBL will now be conducted through Euronet
Paytm Payments Bank (PPBL) has moved its bill payment operations to Euronet Services India, after recently switching its retail point-of-sale business to RBL Bank and merchant payment settlement services to Axis Bank.
Euronet, s US-based payment technology firm, specialises in managing backend settlement systems for numerous digital payment channels in India.
As per ET’s report, as PPBL was asked to cease its offering services, it had to migrate to someone else and Euronet has taken over the business.
Inc42’s query on the development did not elicit any response from Paytm till filing of this report.
Under this partnership, bill payments facilitated by PPBL will now be conducted through Euronet. It is pertinent to note that the backend infrastructure for significant bill payments in India is driven by Bharat BillPay, a subsidiary of the National Payments Corporation of India (NPCI).
As per Bharat BillPay’s data, Euronet processed around 19 Mn consumer-oriented bill payments in March, marking a significant surge from 4.6 Mn in January. This substantial increase is attributed to the collaboration with Paytm.
As a settlement platform, banks earn a commission for each bill payment processed through Bharat BillPay. However, for Paytm, this revenue stream will diminish, as it will only receive a small commission as the sourcing entity for the bill payment transaction, the report said, citing a source close to the matter.
Meanwhile, the regulatory actions against Paytm Payments Bank have impacted its mobile wallet business operation.
In March, Paytm Payments Bank recorded 7.4 Mn fund transfer transactions in its prepaid payment instruments division, marking a substantial 64% decrease from the 20.7 Mn transactions reported in December 2023, as per the Reserve Bank of India’s (RBI) data.
For use of the wallet for purchasing goods and services, transactions amounted to just over a quarter at 66 Mn, as opposed to 247 Mn during the same time frame.
The fintech major’s crisis started when the RBI barred Paytm Payments Bank from any deposits or credit transactions, or top-ups in any of its customer accounts. The central bank further said PPBL also cannot provide any other banking services, such as UPI facility and fund transfers.
To address regulatory concerns and restore confidence, Paytm has undertaken several measures, including revamping its payment bank’s board. Additionally, it has forged partnerships with PSP banks to sustain its services and relocated the nodal account of Paytm Payments Bank to these institutions.
