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Paytm cuts down losses by 30%, says on path to being profitable by 2022

Written by Moulishree Srivastava Published on 

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The Noida-headquartered payment and financial services firm aims to become profitable by 2022.

India’s most valued startup One97 Communications, which operates payments and financial services firm Paytm, narrowed down its consolidated losses by 30% to USD 399.6 million (INR 29.42 billion) in the financial year ended on March 31, 2020. Earlier in September, the company said it had curtailed its expenses last year, which helped it cut down its losses.

The Noida-based company’s revenue declined marginally by 1% to USD 455 million (INR 33.5 billion) on a standalone basis, but its consolidated revenues for the last fiscal went up by 1.4% to USD 493 million (INR 36.3 billion), local media outlets reported citing documents from business intelligence platform Tofler.

One97’s expenses fell by 20% to USD 796 million (INR 58.6 billion) in FY 2020, as compared to total expenses of USD 985.5 million (INR 72.54 billion) in FY19, as per the disclosures.

At present, 10-year old Paytm competes with Walmart-owned PhonePe, Google Pay, Amazon Pay, and now WhatsApp Pay as well in the digital payments space, which is poised to reach USD 1 trillion by 2023. The SoftBank-backed firm had been trying to come out of the red and aims to become profitable by 2022.

To achieve that target, the payments firm has been expanding its financial services to include lending, insurance, wealth management, commerce, and gaming among others, over the last few years. Paytm has also ventured into merchant management services, wherein it provides digital ledger services and payout services for small merchants and businesses. The company claims to have over 17 million merchants on its platform.

Over the last couple of years, the financial services space has emerged as the new battleground for payments services firms, which have realized that it is difficult to earn money just from their core offering of money transaction.

Paytm had raised USD 1 billion in November 2019 in a round led by T Rowe Price at a USD 16 billion valuation. According to the company, it is “on the path to being profitable by 2022.”

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