Paytm started generating revenue from its in-house AI products this quarter, pulling in "a few lakhs." This marks a crucial pivot to software services, moving beyond its core payments and financial products. It comes as the company seeks to revive its core wallet business with a new licence application after its Payments Bank saga.
How We Got Here
Following the Reserve Bank of India's decision to cancel its Payments Bank licence earlier this year, Paytm urgently needed to diversify its revenue streams. This urgency likely accelerated its push into AI software sales and the application for a new wallet licence.
The Numbers
- Paytm's in-house AI model is optimized with 4 billion parameters, offering low latency and fewer tokens than popular models.
- CEO Vijay Shekhar Sharma named Flipkart, as well as offline retailers and merchants, as potential clients for these AI products.
- Paytm aims to scale its AI revenue into a "meaningful business" within less than a year, which it plans to report under "Commerce Cloud."
- Internal AI deployment also helps Paytm lower operating costs, specifically in software, cloud, and data centre expenses, and enables merchant onboarding.
- Paytm Payments Services Ltd, a wholly-owned subsidiary, has applied for a Prepaid Payment Instrument (PPI) licence to revive its wallet operations.
What Happens Next
🇮🇳 Why This Matters for India
For Bangalore's SaaS founders and Mumbai's fintech product managers, Paytm's aggressive pivot to selling AI as a service signals a viable new revenue frontier for companies grappling with regulatory headwinds in core financial services.
The Take
The AI sales are a smart distraction, giving investors something new to cheer about. But the wallet licence remains the real bellwether for Paytm's core business viability.
Source:
MediaNama ↗