The government has given its go-ahead to Paytm’s payment aggregator business licence. Following the report, the shares of One97 Communications, the parent of Paytm, shares surged Rs 46.25 or 10 per cent to 508.85 apiece on the BSE.
Paytm can now approach the Reserve Bank of India (RBI) to seek payment aggregator licence which the central bank will evaluate.
“Paytm has received the government’s go-ahead to set up payment aggregator business. However, a formal certificate is yet to be received. This comes after the earlier proposed investment from a Chinese entity, which was the major roadblock earlier, is no more proposed now,” a source close to the development told news18.com.
Reuters had earlier today reported that Paytm has got approval from the government for its Rs 50 crore investment in a key subsidiary.
The approval will remove the main stumbling block to the unit, Paytm Payment Services, resuming normal business operations.
Paytm Payment Services is one of the biggest remaining parts of the fintech firm’s business, accounting for a quarter of consolidated revenue in the financial year ended March 2023.
Brokerage firm Emkay in a note on July 22 said, “We believe that the long-pending FIPB approval for investment in its payment subsidiary, expected in near term, which is likely to pave the way for an a/c aggregator license, could be sentimentally positive.”
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