Paytm receives NPCI nod to onboard new UPI users

One97 Communications Limited, the parent company of Paytm, announced that it has received approval from the National Payments Corporation of India (NPCI) to onboard new users onto its UPI platform. 

This decision follows NPCI’s evaluation of Paytm’s request, which was initially submitted on August 1, 2024. This allows Paytm to resume onboarding new UPI users, a process that had been halted following directives from the Reserve Bank of India (RBI).

In response to Paytm founder Vijay Shekhar Sharma’s letter, NPCI chief Dilip Asbe said, “We acknowledge the receipt of your letter dated 1 Aug 2024 regarding your request to grant approval for onboarding new UPI users on Paytm app, which was stopped as per RBI directions dated 31 st January 2024 and 16th February 2024. Upon examination of your request, we hereby accord our approval and permit One97 Communications Private Limited (OCL) to onboard new users on their UPI application.” 

The approval is conditional upon Paytm's compliance with specific guidelines and requirements established by NPCI, including circulars related to risk management, brand standards, multi-bank protocols, TPAP market share, and customer data protection.

Paytm is also required to fulfill its obligations under the tri-partite agreement with NPCI and Payment Service Provider (PSP) banks. Moreover, the company must follow the Storage of Payment System Data guidelines issued in 2018.

This approval is a breather for Paytm, as it enables the company to expand its user base on the UPI platform once again. According to NPCI data, Paytm is the third-largest UPI player after PhonePe and Google Pay. As of September, the firm processed more than 1 billion transactions on a monthly basis.

The development coincides with Paytm’s quarterly results. The Noida-based firm registered Rs 1,660 crore in revenue for Q2 FY25, along with a Rs 960 crore profit.