Paytm has delivered another stellar performance in Q3 FY 2025, reaffirming its leadership in India’s digital payments and financial services distribution space. The company registered a revenue of Rs 1,828 crore, marking a 10% quarter-on-quarter growth. This growth was propelled by higher GMV, robust device additions, and increased revenue from the distribution of financial services. Notably, it achieved a PAT improvement of Rs 208 crore QoQ, positioning its PAT at Rs (208) crore, excluding the exceptional gains on sale of entertainment business of Rs 1,345 Cr reported in the previous quarter. EBITDA Before ESOP has improved by Rs 145 Cr QoQ to Rs (41) Cr.
Core Payments Business Driving Growth; Innovations in Merchant and Consumer Offerings impress
Paytm’s merchant subscriber base for payment devices continues to grow at a remarkable pace, reaching 1.17 crore as of December 2024, with an impressive addition of 5 lakh subscribers during the quarter. Subscription revenue growth was driven by higher revenue per merchant. New subscription paying device merchant sign ups continue to see strong growth with gross device additions in Q3 FY 2025 comfortably surpassing January 2024 run-rate.
This expansion not only enhances the merchant ecosystem but also contributes to higher subscription revenues, strengthening Paytm’s position as a leader in the digital payments space. The integration of RuPay Credit Cards with UPI further enhances transaction convenience, creating new opportunities for revenue growth.
Paytm recently launched a new and improved made-in-India Soundbox for UPI and Credit Card on UPI payments with large battery life & 4G connectivity last year. The fintech pioneer also introduced the NFC Soundbox, a solution designed to meet the growing demand for contactless payments. These efforts also underline Paytm’s commitment to supporting MSMEs through tailored financial products and innovative solutions that meet diverse business needs. Similarly, for fast and hassle-free transactions, it introduced Paytm UPI Lite Auto-Top, and for simplified expense tracking, Paytm started UPI Statement download.
Strong Financial Services, Operational Efficiency
Paytm’s financial services segment continued to contribute to this quarter’s success, generating Rs 502 crore in revenue—a remarkable 34% QoQ growth. The company’s focus on merchant loans, improved collection efficiencies, and higher revenue from its DLG portfolio played pivotal roles in this achievement. For the distribution and collection model, it sees increased willingness from lenders to partner for select customer cohorts and allocate capital in the Default Loss Guarantee (DLG) model, which will help to increase disbursements with the existing and new partners.
Cost management continues to be a cornerstone of Paytm’s strategy, with indirect costs reduced by 7% QoQ and employee costs decreasing by Rs 451 crore for the first nine months of FY 2025. The company’s proactive approach, including refurbishing inactive devices for redeployment, has significantly lowered capital expenditure while driving higher revenue per merchant.
Looking Ahead
Paytm’s vision extends globally as the company explores opportunities to replicate its technology-led financial services model in international markets. With a focus on innovation, operational efficiency, and customer-centric solutions, Paytm is well on its way to achieving profitability while solidifying its position as a transformative force in the digital economy.
