Paytm Rides High: Shares Surge on RBI’s Review of Third-Party App Status

Shares of One97 Communications, the parent company of Paytm, continued their upward trajectory for the second day in a row, reaching the upper circuit limit once again. This surge comes in response to the Reserve Bank of India’s (RBI) instruction to the National Payments Corporation of India (NPCI) to reevaluate Paytm’s application to become a third-party app provider for Unified Payments Interface (UPI) transactions.

On both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE), the stock price soared by 5%, closing at Rs 428.10 and Rs 427.95 respectively. This positive momentum arrives after a challenging period for Paytm, marked by a significant decline in its shares following RBI restrictions on its payments bank subsidiary in January.

While the RBI’s directive does not immediately grant Paytm’s request, it signals a potential opportunity for the company. The review process initiated by the NPCI holds promise for Paytm’s re-entry into the UPI space, a critical component of its digital payments ecosystem.

Industry analysts view the RBI’s action as a positive step towards resolving Paytm’s challenges. However, the success and timeline of the review process remain uncertain, leaving the final decision pending.

Here’s a summary of the key developments:

Paytm’s shares have surged for the second consecutive day, hitting the upper circuit limit.
The RBI has directed NPCI to reassess Paytm’s application as a third-party UPI app provider.
While not an immediate approval, this review offers hope for Paytm’s return to the UPI landscape.
Analysts see this as a potential turning point for the company, although the outcome and timeline are yet to be determined.