The RBI’s prohibition on Paytm Payments Bank: How Google and Walmart stand to gain the most from India’s UPI market

In India’s UPI sector, Google’s GPay and Walmart Inc.’s PhonePe have fared the best after the Reserve Bank of India banned Paytm Payments Bank earlier this year. The National Payments Council of India (NPCI) has released new statistics showing that these two businesses’ UPI systems are quickly surpassing Paytm in terms of user base.

The biggest winners from Paytm’s decline were, according to NPCI statistics, PhonePe and GPay, whose UPI transaction volumes increased by 7.7% and 7.9%, respectively, in February. According to NPCI statistics, PhonePe recorded 6.1 billion UPI payments and 4.7 billion Google Pay payments last month.
Paytm saw a decrease in payment volume, while PhonePe and GPay saw growth. Notably, even prior to Paytm’s associate bank being placed under prohibition, PhonePe, and GPay consistently outperformed Paytm in terms of the number and value of UPI transactions. Paytm, nevertheless, has long been seen as a major contender.
By the way, earlier this month, Flipkart partnered with Axis Bank to join the Indian UPI market.
On January 31, the Reserve Bank of India issued an order to Paytm Payments Bank, which handles the majority of Paytm’s financial services and payments but is not under its control, to shut down most of its operations. Even while Paytm swiftly forged new bank alliances to continue operating, the regulator’s action precipitated a precipitous decline in the company’s stock and negatively impacted consumer perception. Paytm’s stock has dropped by over 50% since the end of January.
This week, the billionaire founder of Paytm, Vijay Shekhar Sharma, expressed confidence in the business’s ability to overcome regulatory setbacks and emerge stronger in his first public remarks since the RBI move. Paytm is a digital payments startup.
Sharma’s fintech empire includes both Paytm Payments Bank and Paytm, which is traded as One97 Communications Ltd.; however, the bank is not listed. One97 has the remaining 51% of the bank, while Sharma owns 51% of it.