3 days ago
Explained: Why Paytm shares surged over 5% today
Paytm shares jumped as much as 6% in early trade on Wednesday after its fully-owned arm, Paytm Payments Services Ltd (PPSL), received the Reserve Bank of India's (RBI) 'in-principle' approval to operate as an online payment aggregator under the Payment and Settlement Systems Act, move lifted investor confidence, pushing Paytm's stock to a high of Rs 1,187 on the Bombay Stock Exchange (BSE).advertisementThe RBI also lifted merchant onboarding restrictions on PPSL that had been in place since November 2022, effective immediately. However, the authorisation is strictly limited to online payment aggregator operations as defined under RBI's guidelines, with certain transactions, such as merchant payouts, barred from routing through the designated escrow account.
To ensure robust risk management and cybersecurity, RBI has mandated a comprehensive system and cybersecurity audit by a CERT-In empanelled auditor, a Certified Information Systems Auditor (CISA), or a DISA-qualified professional from audit must comply with RBI's Master Direction on Cyber Resilience and Digital Payment Security Controls, as well as the circular on payment data storage. The audit report is to be submitted within six months, failing which the approval will lapse PPSL must seek prior RBI approval for any changes in its shareholding or ownership structure, underscoring ongoing regulatory the business side, Paytm reported steady June-quarter results, with revenue matching estimates and profits strengthening thanks to tight cost controls. The company also saw better-than-expected gross merchandise value (GMV) recovery, while monthly transacting users held steady, signaling stable operational momentum.(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)- Ends
