“Paytm’s Bold Expansion Plans: 1.5 Million New PoS Devices Every Quarter and Merchant Lending Surge”


Paytm, a leading player in the digital payment market, is set to deploy 1.5 million point-of-sale (PoS) devices quarterly for the next 18-24 months. The move aims to meet the increasing demand for PoS technology from its 3.8 crore merchant base. Additionally, Paytm is focusing on merchant lending, reporting substantial growth in this segment.

Paytm Plans Aggressive Expansion with 1.5 Million New PoS Devices Every Quarter
Paytm Plans Aggressive Expansion with 1.5 Million New PoS Devices Every Quarter

In a strategic move to solidify its presence in the digital payment and merchant services sector, Paytm has announced ambitious plans to deploy a whopping 1.5 million offline point-of-sale (PoS) devices every quarter for the next 18-24 months. This revelation came during an analyst call on October 21, setting the stage for substantial growth and expansion in the company’s merchant services.

Paytm’s Group Chief Operating Officer, Bhavesh Gupta, stated, “We added new personnel within the device deployment salesforce. Our goal is to achieve stable growth by adding approximately 1.5 million soundbox and card machines every quarter for the next 18-24 months.” This aggressive expansion plan is driven by the increasing demand for products such as soundboxes and card machines, as merchants seek advanced technology solutions.

The company’s move comes on the heels of its impressive financial performance in the second quarter of 2023, reporting a consolidated revenue of Rs 2,519 crore, a remarkable 32 percent increase compared to the previous year. This growth was attributed to improved payment processing margins and an uptick in loan disbursement.

As of September 2023, Paytm boasts a vast merchant base of approximately 3.8 crore, with 92 lakh merchants paying subscriptions for devices. This marks an impressive increase of 44 lakh Year-over-Year (YoY) and 14 lakh Quarter-over-Quarter (QoQ). During the second quarter, Paytm introduced several new devices, including card soundboxes, pocket soundboxes, and music soundboxes, catering to the evolving needs of its merchant network.

One noteworthy innovation is Paytm’s PoS device, which accepts cards and UPI payments while doubling as a soundbox, featuring audio-assisted alerts with SIM-based connectivity. These launches are expected to expand the Total Addressable Market (TAM) and enhance merchant engagement and card acceptance.

While the PoS device market is currently dominated by players like Pine Labs and Razorpay, Paytm is making significant strides in this sector. According to RBI data available as of May 2023, there are around 79 lakh PoS devices across India. Moreover, PhonePe has recently entered the market with its own Point-of-sale (POS) device, further intensifying competition.

Beyond expanding its PoS device network, Paytm is making substantial investments in merchant lending. Despite the muted growth in personal loans, the company reported a significant increase in merchant loan disbursals. In the September quarter, Paytm disbursed loans totaling Rs 16,211 crore, marking a remarkable 122 percent growth. Merchant loans accounted for Rs 3,275 crore, while personal loans contributed Rs 3,927 crore. Postpaid loans reached a total of Rs 9,010 crore.

Paytm offers four distinct credit portfolios, including Paytm Postpaid, personal loans, merchant loans, and co-branded credit cards. Bhavesh Gupta mentioned, “Personal loans are expected to remain muted for the next couple of quarters, with a year-on-year growth of around 30-40%. However, we are very bullish on merchant loans, projecting a healthy blended credit growth of 40-50% in two to three years.”

Paytm’s Postpaid loan business already boasts around 40 million merchants, with over 20 million adopting the post-paid product. Notably, less than 1 million merchants are charged the Merchant Discount Rate (MDR). Paytm has taken a flexible approach, not mandating MDR for offline merchants whose post-paid usage crosses double digits.

Moreover, Paytm has added Tata Capital as a new lending partner and is actively seeking additional partners, including banks, to further enhance its lending and financial services.

As Paytm continues to aggressively expand its PoS device network and solidify its presence in merchant lending, the digital payment giant seems poised to maintain its dominant position in India’s evolving financial technology landscape.

Sources By Agencies

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