Will Paytm continue to thrive as a Fintech Giant?
Paytm is a multinational Fintech firm founded in 2010 in India, providing digital financial services and online payment mechanisms. The Fintech giant has invested in several start-ups and acquired a few along its journey.
On 8th November 2021, Paytm was set to go public; it was the biggest IPO ever to be launched in India, worth INR 18,300 crores. However, the share price of the Fintech giant dropped significantly shortly after the market debut, from INR 2,150 per share, which was the issue price, to INR 1,950, a 9% drop from the initial price. Paytm’s share prices have never touched the initial price to date; the company has lost a lot of funding, resulting in a stumbling block for its expected growth.
The founder and CEO of Paytm, Vijay Shekhar Sharma, announced that the company would be shutting down Paytm Labs Inc, (the firm’s division based in Canada), on 14th March 2022. In the year 2014, the Canadian division started as a Research and Development (R&D) segment of Paytm and grew along the way. However, Paytm Labs Inc was not contributing much to the company’s overall revenue, and therefore served no purpose to continue its operations in Canada.
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The CEO has also stated that Paytm is not alone in the Global Fintech industry when it comes to poor performance in the share market but is in line with its rivals worldwide, the reason being the several macroeconomic variables. However, since Paytm has already established its footprint in the online payments segment, there are several questions on the company’s future in the Fintech sector. Investors will need to know the plans Paytm has come up with to monetize its diverse range of financial services in this extremely competitive market.
Paytm may be having a lot of hurdles at present, but it should be kept in mind that the Fintech industry is a growing sector and has tremendous potential. Therefore if Paytm plans well, it can become a major player in the global spectrum.