After the government approved Paytm’s application to invest Rs 50 crore in its payment arm Paytm Payment Services, shares of the fintech giant went up by 10% to Rs 508.85 apiece on the BSE during the intraday trade on Friday.
The approval was at a standstill on account of China-based Antfin (Netherlands) Holdings’ stakes in Paytm’s parent company One 97 Communications. The former held 9.88% stakes in the latter’s parent entity as of March 2024.
The government committee in charge of investments involving China gave a nod to Paytm’s Rs 50 crore investment in its subsidiary.
With the approval, Paytm can apply for an online payment aggregator (PA) license from the Reserve Bank of India.
The apex bank introduced the framework for PA license in March 2020, which mandates that payment gateways need to secure an aggregator license to onboard merchants and deliver digital payment solutions.
The fintech major incorporated Paytm Payments Services to get a PA license. Paytm had applied for a PA license in 2020 where RBI had instructed it to reapply once compliance with FDI rules was ensured.
