Paytm wins preliminary RBI nod to issue wallets as shares hit record
Paytm has secured an in-principle approval from the Reserve Bank of India for its payments services unit to issue prepaid payment products, including digital wallets, the company said. The nod lets Paytm rebuild a wallet business it ran independently until the RBI's restrictions on Paytm Payments Bank cut it off.
Paytm Payments Services can offer prepaid payment instruments once the RBI grants final authorisation. The company's shares rose as much as 1.8% to 1,960 rupees before closing 0.8% higher, and the stock is up nearly 50% so far this year.
Anand Dama, executive director and head of banking and financial services research at Nuvama Institutional Equities, said the licence opens revenue opportunities including a prepaid card business and signals easing regulatory friction. He cautioned that the final licence will take time, so any revenue impact would be seen in financial year 2028.
Paytm launched its wallet in 2014 and became the country's largest digital wallet provider before transferring the business to Paytm Payments Bank in 2017 to meet regulatory requirements. The RBI barred the bank from onboarding new customers in 2022, then in 2024 stopped it accepting fresh deposits, credits and top-ups over persistent non-compliance and supervisory concerns. The central bank cancelled the bank's licence earlier this year, leading to its winding up.
The next step is the RBI's final authorisation for Paytm Payments Services, which the company needs before it can issue prepaid payment instruments to customers.
