Shares of Paytm’s parent company, One97 Communications Limited, fell over 3 per cent on Wednesday after the company temporarily halted its Postpaid loan facility. At the closing bell, shares of the company were down 3.12 per cent at Rs 813.30 apiece.
Many Paytm Postpaid users took to social media platform X and said they were unable to access the loan facility despite clearing dues. On clicking the Postpaid loan icon on the app, a message read: “We are upgrading the experience and enhancing the security measures. We will be back soon.”
According to social media posts on X, users have been facing issues with the Postpaid loan facility since November 30. A Postpaid user said, “Today, multiple users including me experienced issue with Paytm Postpaid being blocked without any apparent reason. As a longstanding customer of Paytm, this is utterly disappointing. The company should issue a clear statement if there’s a glitch. I am confident there is an internal issue, as there’s no reason to be blocked when we consistently pay our bills on time.”
Several other users tagged the company on X and complained that their Postpaid accounts are not working despite clearing dues. “Hey team, I’m the user of Paytm & Paytm Post paid from the so many years Paytm Postpaid not working from 1st December. Pease solve this issue and inform me,” said another Postpaid user on X.
Meanwhile, an Economic Times report said Paytm has temporarily halted Postpaid operations as its non-banking financial company (NBFC) partners have become cautious after the Reserve Bank of India raised risk weightages by 25 per cent against unsecured lending.
According to sources who spoke to the business daily, a major NBFC partner of Paytm seems to have pulled out of the partnership, leading to the disruption in Postpaid operations. As mentioned earlier, new sign-ins for the Postpaid facility have also been stopped by the company.
Paytm shifts focus to higher ticket loans
A Paytm spokesperson told IndiaToday.in that Paytm Postpaid facility has not been shut, even as the loan facility remains unavailable for several users. Meanwhile, the company shared an update and outlook on its loan distribution business, where it said it will cut down on disbursing credit under Rs 50,000 and focus on higher ticket loans.
The decision comes weeks after the RBI tightened rules on consumer lending after a surge in demand.
The company announced that it will further expand its business to offer higher-ticket personal and merchant loans, which would be targeted at lower-risk and high credit-worthy customers, in partnership with large banks and NBFCs.
“On the back of recent macro development and regulatory guidance, in consultation with lending partners, in line with its continued focus on driving a healthy portfolio, the company has recalibrated the portfolio origination of less than Rs 50,000, which is prominently the postpaid loan product and will now be a smaller part of its loan distribution business going forward,” Paytm said in the stock exchange filing.
“Merchant loans, which are given to MSME as business loans, will continue to be a focus for Paytm. As these loans are given for business purposes to small merchants, they don’t get impacted by the recent regulatory guidance,” the company’s statement read.