Paytm’s year in a review – Billions, profits and frauds
Paytmhit $50 billion through 5.5 billion transactions in the financial year 2018-19.
- Paytm Payments Bank turned profitable within two years.
- The company’s year was denoted by two big frauds – both internal.
In the financial year 2018-19, the company clocked in billions from its digital payments arm, and its payments bank turned profitable. But, it was also hit by two major scandals.
Paytm released its results for the financial year 2018-19 and the digital payments company continues to score big in India. Paytm has clocked in a gross transaction value of $50 billion through 5.5 billion transactions. It also set a target of 12 billion transactions by FY20.
The company stated that the fast growth came was due to the wide adoption of Paytm’s digital payments solutions across sectors like retail payments, fees, utility payments, travel booking, entertainment, games and more.
Holding over 50% of the market share in the payment gateway industry, the company said that its 400 million transactions per month; is five times more than its next competitor.
The Paytm Payments Bank which received its approval from the RBI in 2015 had gained a lot of attention as it was the first in the space to gain a bank licence. But, this side of the business had a sleepy start.
It run into multiple problems too – with the RBI asking it to stop adding new customers due to KYC (Know Your Customer) normal. It also had to remove its CEO to handling a PIL objecting to its postpaid wallet.
Amidst all this, the company turned profitable – it reported a profit of ₹190 million for the said financial year. Reports also say that the Paytm Payments Bank holds 19% of all mobile banking transactions, while also accounting for 32% of UPI transactions in India.
Paytm also has had a dark year with two big scandals. The first one hit them in October 2018, when the company’s Chief Communications Officer Sonia Dhawan said to be the founder Vijay Shekhar Sharma’s close aide, was arrested for an extortion case of ₹200 million.
Meanwhile, Paytm Mall too unearthed a fraud that could have cost the company ₹50-100 million. As a result, Paytm Mall fired about 10 employees and delisted over 100 vendors from its platform. The company also roped in Ernst & Young for an audit. It also partnered with E&Y to build a technology-driven fraud prevention system.
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