The growth in revenue was led by the increase in consumer and merchant payments and disbursements of loans through its partners on Paytm.
The company’s EBITDA loss (before ESOP) for FY22 saw an improvement of 8 per cent year-on-year to Rs 1,518 crore from Rs 1,655 crore the previous year. In addition, the company had Rs 809 crore of non-cash ESOP expenses.
Paytm has reduced EBITDA (before ESOP cost) loss despite making investments in user growth, merchant device deployment and technology. The company’s cost structures in Q4 FY 2022 are largely sufficient to support its growth plans in FY 2023. As a result, the company believes it will show accelerated reduction in EBITDA losses and is well on track to achieve profitability (before ESOP) by September 2023 quarter.
Paytm has a strong two-sided ecosystem of consumers and merchants, where it is seeing the monetization strategy kick in to yield results. On the consumer payments side, the company is recording increasing usage of the Paytm app and Paytm Payment instruments. On the merchant payments side, the company serves the entire base of merchants through (i) QR for payments (typically free), (ii) soundboxes (which generate subscription revenues), (iii) card machines (which generate subscription and MDR revenues), and (iv) Payment Gateway for online merchants (which generates MDR revenues and platform fees). Leveraging this distribution and rich insights, Paytm offers financial products to its consumers and merchants, in partnership with financial institutions.
Increased consumer engagement and merchant base leads to higher revenue from Payment services. The company has recorded a jump in its average monthly transacting users in FY22 to 60.8 million, the average for the last quarter further increased to 70.9 million. Paytm’s merchant base has also grown to now have 26.7 million merchant partners, with 2.9 million devices deployed as of FY22.
The increased consumer engagement and merchant base has also led to increased revenue from Payment Services (both to consumers and merchants). Paytm’s Revenue from Payment Services to Consumers was up 58 per cent to Rs 1,529 crore in FY 2022 from Rs 969 Cr for the FY 2021. For the full year, Revenue from Payment Services to Merchants was up 87 per cent to Rs 1,892 crore in FY 2022 from Rs 1,012 crore for FY 2021.
One of the highlights of Q4FY22 and FY22 has been the rapid scale-up of Paytm’s loan disbursement business, where it offers Paytm Postpaid (Buy Now, Pay Later), personal loans and merchant loans. In April 2022, the company reached an annualised run rate of approximately Rs 20,000 crore of disbursement through its platform.
For the full year, the number of loans disbursed through the Paytm platform has grown 478 per cent year-on-year to 15.2 million in FY 2022 from 2.6 million in FY 2021. The value of loans disbursed has grown 441 per cent year-on-year from Rs 1,409 crore in FY 2021 to Rs 7,623 crore in FY 2022.
The number of Postpaid Loans disbursed grew 373 per cent year-on-year in Q4 FY 2022, while the value of Postpaid Loans grew 425 per cent year-on-year, thus highlighting increased usage by customers.
Personal Loans disbursed through partners on Paytm grew 948 per cent year-on-year in Q4 FY 2022, while the value of Personal Loans grew 1,082 per cent year-on-year. The number of Merchant Loans disbursed grew 123 per cent year-on-year in Q4 FY 2022, while the value of Merchant Loans grew 178 per cent year-on-year. The average ticket size has also increased in FY22, with personal loans ranging from Rs 85,000 to Rs 95,000 and merchant loans ranging from Rs 1,30,000 to Rs 1,50,000.