Description

One 97 Communications Limited (Paytm) clarifies impact of PIDF scheme expiry, which provided INR 128 crores in incentives for H1 FY2026, and expects to offset through higher revenues and targeted sales efforts.

Summary

One 97 Communications Limited (Paytm) has issued a clarification regarding the Payment Infrastructure Development Fund (PIDF) scheme following media reports about stock price decline. The company disclosed that it received INR 128 crores in incentives during the six months ended September 30, 2025 under the RBI scheme, which was valid until December 31, 2025. The scheme incentivized deployment of payment acceptance devices in Tier-3 to Tier-6 centres and northeastern states. With no current announcement on scheme extension, Paytm expects to significantly offset the impact through higher revenues and more targeted sales efforts.

Key Points

  • PIDF scheme incentive recognized: INR 128 crores for six months ended September 30, 2025
  • Scheme was valid until December 31, 2025 and has now expired
  • Incentives covered deployment of Soundboxes and EDC Machines in Tier-3 to Tier-6 centres
  • Also covered northeastern states and Union Territory of Jammu, Kashmir and Ladakh
  • No announcement yet from RBI on scheme extension or replacement
  • Company expects to offset impact through combination of higher revenues and targeted sales efforts
  • Clarification issued in response to NSE and BSE queries on media reports
  • Media article referenced: “Paytm shares fall 10% from day’s high, extend their losses for the week” on CNBC TV18

Regulatory Changes

No new regulatory changes announced. The circular addresses the expiry of an existing RBI scheme (PIDF) that was implemented to encourage payment infrastructure deployment in underserved areas. The scheme’s expiry on December 31, 2025 represents the end of a temporary incentive program rather than a new regulatory change.

Compliance Requirements

  • Company has appropriately disclosed material information regarding the PIDF scheme impact as required under stock exchange regulations
  • Disclosure made in response to clarification sought by NSE (NSE/CM/Surveillance/16365) and BSE (L/SURV/ONL/RV/SG/(2025-2026)/146)
  • Company committed to making appropriate future disclosures as and when required under applicable laws
  • Disclosure hosted on company website at https://ir.paytm.com/

Important Dates

  • January 23, 2026: Date of clarification circular and stock exchange queries
  • December 31, 2025: PIDF scheme expiry date
  • September 30, 2025: End of reporting period for disclosed incentive amount (H1 FY2026)

Impact Assessment

Financial Impact: The expiry of the PIDF scheme removes a significant revenue stream of INR 128 crores (recognized in H1 FY2026). This represents a material impact on the company’s payment device deployment economics, particularly for Soundboxes and EDC machines in Tier-3 to Tier-6 markets.

Operational Impact: The company will need to adjust its deployment strategy for payment acceptance infrastructure in smaller towns and underserved regions. Without government incentives, the business case for aggressive deployment in these areas may be weaker.

Strategic Response: Management expects to offset the impact through:

  1. Higher revenues from existing deployed devices
  2. More targeted sales efforts focusing on better ROI locations
  3. Potential operational efficiency improvements

Market Impact: The disclosure was prompted by significant stock price volatility (10% intraday decline), indicating market concern about the scheme’s expiry. The medium-term impact will depend on the company’s ability to execute its offset strategy and whether the RBI announces any replacement scheme.

Impact Justification

Material disclosure regarding expiry of RBI incentive scheme worth INR 128 crores in H1 FY2026, but company expects to offset impact through operational measures