Paytm reports 28% revenue growth in Q2 FY27, while global brokerages say the company’s profitability outlook remains positive even without UPI-MDR income.
Highlights
- Paytm says potential UPI-MDR introduction could create an additional revenue opportunity.
- Q2 FY27 revenue rises 28% year-on-year to ₹2,648 crore.
- EBITDA reaches ₹270 crore, with margins exceeding 10%.
- JP Morgan highlights merchant business growth and cost control behind EBIT breakeven.
- Goldman Sachs expects EBITDA improvement even without UPI-MDR benefits.
- Bernstein forecasts approximately ₹1,288 crore EBITDA for FY27, excluding UPI-MDR income.
Paytm Sees UPI-MDR as Additional Earnings Opportunity as Core Business Strengthens
New Delhi, October 27, 2026: Fintech major Paytm expects the potential introduction of a merchant discount rate (MDR) on Unified Payments Interface (UPI) transactions to create an additional earnings opportunity, rather than become the primary driver of its profitability.
According to the company’s Q2 FY27 earnings commentary and assessments by global brokerages, Paytm’s existing business operations are already generating profits, supported by stronger payment monetisation, financial services growth and improved cost efficiency.
Revenue Jumps 28% in September Quarter
Paytm reported a 28% year-on-year increase in revenue to ₹2,648 crore for the September quarter of FY27.
The company’s EBITDA stood at ₹270 crore, with operating margins expanding beyond 10%, reflecting improved profitability across its existing business operations.
The performance suggests that Paytm’s merchant-focused business model is generating earnings without depending on any additional revenue from a potential UPI-MDR framework.
Global Brokerages Highlight Profitability
JP Morgan, in its report titled First Take: All-round Beat, highlighted Paytm’s growing merchant franchise and disciplined cost management as key factors behind achieving EBIT breakeven.
Goldman Sachs also indicated that Paytm expects continued EBITDA improvement even without additional income from UPI merchant discount rates.
Meanwhile, Bernstein projected approximately ₹1,288 crore in EBITDA for FY27, explicitly excluding any potential UPI-MDR contribution from its estimates.
Financial Services Revenue Rises 49%
Paytm’s financial services business emerged as another important growth driver, with revenue increasing 49% year-on-year.
Bernstein also noted that net payment revenue increased 7% sequentially despite unchanged payment gross merchandise value (GMV), indicating improved monetisation of existing transaction volumes.
This suggests that Paytm is generating higher payment revenue without requiring a corresponding increase in overall transaction value.
What UPI-MDR Could Mean for Paytm
The proposed UPI-MDR framework could allow payment service providers to earn additional revenue from eligible merchant transactions, depending on the final regulatory structure.
However, the framework remains a potential opportunity rather than a confirmed revenue stream
