Paytm’s Loan Disbursals Jump 167% YoY To INR 14,845 Cr In April-June

Fintech giant Paytm saw its loan disbursals surge 167% year-on-year (YoY) to INR 14,845 Cr during the April-June 2023 quarter, while the number of loans also increased 51% YoY to 12.8 Mn.

The growth in the value of loans and number of loans disbursed was a modest  7.56% and 18.25%, respectively, on a quarter-on-quarter basis, as per the quarterly performance update filed by the company with the stock exchanges.

In the month of June, the number of loan disbursals by Paytm reached nearly 4 Mn worth INR 5,227 Cr, a decline of 2.27% and 5.02% compared to May 2023. The company attributed this decrease to higher disbursals in May.

“MoM loan distribution trend in June reflects the higher disbursal in May which included pent-up demand for merchant loans from April due to one of our partners not disbursing as they were upgrading their systems,” Paytm said. 

The average ticket size for loans fell to INR 12,155.81 in June from INR 12,506.82 in May 2023. For more context, the average ticket size stood at INR 6,778.62 in June 2033. 

The Vijay Shekhar Sharma-led fintech giant has issued 24.7 Mn loans worth INR 27,399 Cr so far in 2023.

Paytm is also working on expanding its lending partnerships with non-banking financial companies (NBFCs) to grow its loan book further.

“We currently have 7 active lending partners and we aim to onboard 3-4 partners in FY24,” said the fintech giant. Recently, Paytm said it had finalised a lending partnership with Shriram Finance Limited on June 30, 2023.

Among other businesses, Paytm’s gross merchandise value (GMV) rose 37% YoY to INR 4.05 Lakh Cr ($49.3 Bn) in the quarter ended June 30, 2023.

The fintech giant also reported a snapshot of other operating metrics, including gross merchandise value (GMV), average monthly transacting users (MTU) and total subscription merchants of its payment devices. Monthly transacting users increased to 92 Mn in June quarter from 75 Mn in March 2023 quarter.

Paytm also said the number of subscribers for its Soundbox and other PoS devices stood at 7.9 Mn in June 2023 quarter, a jump of 109% from 3.8 Mn in the year-ago quarter. 

As per a recent report by BofA Securities, Paytm, which had the first-mover advantage in the Soundbox space, is seeing increasing competition. However, the brokerage believes that it won’t affect Paytm and the company is well-placed to capitalise on its deep penetration in the segment. 

Meanwhile, Motilal Oswal is bullish on Paytm’s lending business and increased the price target on the stock to INR 1,050 earlier this week from INR 865 before.

Shares of Paytm jumped nearly 2% on Wednesday following the positive update by the company to end the session at 853.25 on the BSE.