Updated February 19th, 2024 at 11:10 IST

Paytm shares rise 5% as RBI extends fresh deposit deadline

Paytm Payments Bank can now accept fresh deposits in its accounts or wallets until March 15.

Reported by: Business Desk
Paytm | Image:Paytm/Facebook
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Paytm shares rise: Shares of payments firm Paytm surged 5 per cent on Monday following the RBI decision to grant its banking arm, Paytm Payments Bank, more time to wind down operations. The stock hit an upper trading limit of Rs 358.35.

The RBI extended the deadline for Paytm Payments Bank to stop accepting fresh deposits in its accounts or wallets to March 15 from February 29. This move is seen as facilitating a smooth transition for transferring Paytm Payments Bank accounts, according to analysts at Bernstein.

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Positive for business

In addition to the deadline extension, Paytm also announced a partnership with Axis Bank (AXBK.NS) on Friday to sustain some of its popular products. Citi brokerage noted that such partnerships are significant positives for ongoing business. Paytm aims to address the current crisis by ensuring that merchants can continue using Paytm QR codes, soundboxes, and card machines linked to non-Paytm Payments Bank accounts.

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Paytm shares have experienced a 53 per cent decline since the RBI's January 31 order against Paytm Payments Bank for persistent non-compliance with regulations. This decline has resulted in the erosion of Rs 255.74 billion ($3.08 billion) in shareholders' wealth.

Analysts, on average, rate Paytm as "hold," with five "sell" or "strong sell" recommendations, according to LSEG data.

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(with Reuters inputs)

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Published February 19th, 2024 at 11:04 IST