Why Paytm shares drop 10% sharply today? Details here
By Aman Shukla Published on June 12, 2025, 09:24 IST
Paytm shares fell sharply by over 10% in early trade on Thursday after the Ministry of Finance strongly denied reports suggesting the possible introduction of Merchant Discount Rate (MDR) on Unified Payments Interface (UPI) transactions. By 9:15 AM, the stock was trading at ₹882.75, down 8.09%.
The ministry clarified that the reports were 'completely false, baseless, and misleading,' reaffirming that there are no plans to impose MDR on UPI payments. It emphasized that promoting digital transactions remains a government priority, and misinformation only fuels 'needless uncertainty, fear, and suspicion.'
This clarification dampened investor sentiment, as expectations of MDR implementation had been seen as a potential revenue boost for fintech firms like Paytm. MDR, a fee charged to merchants by banks for payment processing, was waived in 2020 to encourage digital adoption.
Analysts at UBS noted that the absence or delay of MDR is sentimentally negative for Paytm's parent, One97 Communications, and reiterated a 'Neutral' rating on the stock with a ₹1,000 target price.
Paytm has previously stated that clarity on MDR is vital for its payments profitability roadmap. The government's strong denial now tempers hopes of short-term monetisation through UPI.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions. Author or Business Upturn is not liable for any losses arising from the use of this information.
Aman Shukla is a post-graduate in mass communication . A media enthusiast who has a strong hold on communication ,content writing and copy writing. Aman is currently working as journalist at BusinessUpturn.com
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