Paytm founder Vijay Shekhar Sharma held an analyst call post the Reserve Bank of India's actions on Paytm Payments Bank during which he called the move a "speed bump," and added that with partnerships with other banks, the company will "see this through the next few days or quarters."
Shares of Paytm ended at a lower circuit of 20% on Thursday.
Sharma said that there will be a requirement to have some operational change for which work has started and till the time these operational changes are made, they are pausing the origination of new loans.
"We will not be originating loans for a couple of weeks," Sharma said.
As a result of the disruption, Paytm is expecting a hit of ₹300 crore to ₹500 crore on its annual operating income, which it highlighted in an exchange filing earlier on Thursday morning.
Sharma also mentioned that he cannot foresee what the company can and cannot see as the Reserve Bank of India has not sent any further details on the action yet.
"We are overwhelmed by the support we have received from large banks in the country," the Paytm founder said, adding that One97 Communications will only work with other banks and not Paytm Payments Banks. He further said that more large banks have reached out saying they will be happy to help them.
Post Paytm's announcement on Wednesday, brokerage firm Jefferies downgraded its rating on Paytm to "underperform" from its earlier rating of "buy." The brokerage has also cut its price target on the stock to ₹500 from ₹1,050 earlier.
The Reserve Bank of India on Wednesday directed Paytm Payments Bank to stop deposits or credit transactions or top-ups in any customer account, prepaid instruments, wallets, FASTags, NCMC cards, etc after February 29, 2024, other than any interest, cashback, or refunds which may be credited anytime.
First Published: Feb 1, 2024 4:00 PM IST
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