One 97 Communications, the parent company of Paytm, has approved the transfer of its offline merchant business to its wholly owned subsidiary Paytm Payments Services Limited (PPSL) to comply with the Reserve Bank of India’s (RBI) updated regulations on payment aggregators.
While the company’s board approved the move in a meeting held on Wednesday, the transfer is subject to the execution of definitive agreements, receipt of necessary approval from PPSL’s board, and shareholder consent.
The transfer will consolidate Paytm’s online and offline merchant payments businesses under PPSL, which received in-principle approval from the RBI to operate as an online payment aggregator in August.
The offline business being transferred consists of offline merchants serviced through QR codes, soundbox devices and EDC machines. Paytm will implement the transfer through a slump sale on a going concern basis, ensuring operational efficiency.
“The Company will receive a lump sum cash consideration for the transfer of the Transferred Undertaking, which shall be based on the book value of the assets and liabilities of the Transferred Undertaking determined as on the effective date of the transfer,” Paytm said in a regulatory filing.
How Much Revenue Does Paytm Generate From Its Offline Merchants Biz?
As the transaction involves a wholly-owned subsidiary, it will not impact the company’s consolidated financials.
For the financial year ended March 31, 2025 (FY25), the offline merchants’ payments business generated a revenue of Rs 2,580 crore, accounting for approximately 47% of the total revenue of Paytm on a standalone basis, with a net worth of Rs 960 crore.
The proposed transfer is expected to be completed by December 31, 2025. The fintech company said that the transaction is part of an internal restructuring exercise aimed at bringing all payment aggregator activities under a single regulated entity.
Acquisition of Additional Stakes In Key Units
In a separate exchange filing, One 97 Communications announced that it will acquire a 51.22% stake in Paytm Financial Services Limited (PFSL) from founder Vijay Shekhar Sharma and VSS Invesco Private Limited, in which Sharma owns a 100% stake, for Rs 0.5 crore. Upon the completion of the transaction, PFSL will become a wholly-owned subsidiary of One 97 Communications.
Following the acquisition, certain entities in which PFSL has stakes — including Admirable Software, Mobiquest Mobile Technologies, Urja Money and Fincollect Services — will also come under Paytm’s direct or indirect ownership. In the coming days, the fintech major plans to bring these entities under the direct ownership of One 97 Communications through intra-group transactions.
Admirable Software, which provides manpower services, clocked a revenue of Rs 0.44 crore in FY25. Mobiquest, which offers technology and loyalty solutions, reported a revenue of Rs 33.43 crore, while Urja Money…
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