Paytm shares in focus: Arm Paytm Payments Services gets RBI's nod to operate as payment aggregator

The filing read, "The Reserve Bank of India ('RBI') on November 26, 2025, has granted a Certificate of Authorisation ('COA') to Paytm Payments Services Limited (PPSL), a wholly-owned subsidiary of One 97 Communications Limited ('the Company'), to operate as a Payment Aggregator under the Payment and Settlement Systems Act, 2007."

It must be noted that this is the final approval from the RBI.

In August 2025, Paytm Payments Services received the 'in-principle' approval from the RBI to operate as an online payment aggregator.

The move also removes the restriction on Paytm Payments Services Limited from onboarding new merchants, which was imposed on the company on November 25, 2022.

A “payment aggregator” (PA) is a non-bank entity that collects payments from customers (on behalf of multiple merchants) and routes them to merchants. Instead of each merchant integrating separately with banks, the aggregator acts as a middleman for many.

With full approval now, Paytm can legally onboard new merchants for online payments — which had been restricted since November 2022 (when RBI earlier rejected its application due to compliance issues around foreign direct investment).

The licence strengthens Paytm’s role as a major online merchant-payment processor in India, allowing it to scale payment volumes, expand business, and restore its position in the digital-payments ecosystem.

Paytm Re-rating

Paytm's drive towards sustained profitability has started to show in market sentiment, with multiple analysts acknowledging this shift and turning incrementally positive on the company over the past few quarters.

Recording profits for a second straight quarter, this consistency has not only strengthened its financial fundamentals but also led the market to steadily recognise its strong earnings potential, driving a multi-quarter re-rating in its stock by several leading financial services firms, including JM Financial, Jefferies and Bernstein, among others.

With this improving outlook, analysts indicate that the rerating cycle may still have room to run, as Paytm's valuation remains conservative compared to large internet peers such as Nykaa, FirstCry, PB Fintech, and Zomato.

Reflecting on the second quarter FY26 earnings, JM Financial said Paytm continues to hold 'attractive risk-reward at current market price'.