Published: [October 27, 2026]
StartupFeed Quick Take
- Paytm Q2 profit was Rs 225 crore, against Rs 21 crore a year ago
- Revenue rose 28% to Rs 2,648 crore and the EBITDA margin hit 10%
- The proposed UPI MDR could add about 2.5 basis points to Paytm’s payment margin
Noida-based Paytm reported a net profit of Rs 225 crore for the September quarter on Monday, against Rs 21 crore a year earlier.
That reads like ten-fold growth. It is not. The year-ago quarter carried a one-time charge of Rs 190 crore on a loan it wrote off.
Take that charge out and the comparable profit a year ago was Rs 211 crore. On that base, Paytm Q2 profit grew about 7%.
Operating revenue rose 28% to Rs 2,648 crore, from Rs 2,061 crore, Paytm’s earnings release of October 26 shows.
Where the Paytm Q2 Profit Came From
EBITDA rose 90% to Rs 270 crore, from Rs 143 crore. That is its highest ever for a quarter. EBITDA means earnings before interest, taxes, depreciation and amortisation.
The EBITDA margin hit 10%, double digits for the first time, against 7% a year ago.
Indirect costs rose 14% to Rs 1,209 crore and now take 46% of revenue, against 52% last year. Revenue from distributing loans and other financial products grew 49% to Rs 912 crore.
Contribution profit, which is revenue minus direct costs, rose 23% to Rs 1,479 crore. The contribution margin fell to 56% from 59%. Adjusted for a government payments grant that has since ended, the year-ago figure was 57%.
Paytm expects that margin to fall further in the December quarter. Its default loss guarantee costs will rise sharply. That guarantee is a promise to cover a lender’s losses.
| Metric | Q2 FY27 | Q2 FY26 | Change |
|---|---|---|---|
| Operating revenue | Rs 2,648 Cr | Rs 2,061 Cr | up 28% |
| Net profit | Rs 225 Cr | Rs 21 Cr | 10.7 times |
| EBITDA | Rs 270 Cr | Rs 143 Cr | up 90% |
| Contribution profit | Rs 1,479 Cr | Rs 1,207 Cr | up 23% |
| Contribution margin | 56% | 59% | down 271 bps |
Paytm Puts the First Number on UPI MDR
MDR is the fee a shop pays on each digital payment. Payments above Rs 2,000 to selected merchants would carry 0.4%, capped at Rs 300.
On Paytm’s own estimate, the change would add about 2.5 basis points to its payment processing margin. That margin is now above 4 basis points. So the fee would lift it past 6.5.
The start date is still open. The National Payments Corporation of India pushed the rollout past Diwali on October 13, two days before it was due.
About 96% of merchant payments will not be touched at all. Shops taking up to Rs 1 lakh a month on a UPI QR code stay at zero.
Paytm said the gain should settle within two to three quarters of the start.
Profit for the quarter still fell short of what brokerages expected. They had looked for Rs 271 crore to Rs 279 crore.
Shares of Paytm closed 2.7% lower at Rs 1,655 on the BSE on Monday, before the results came out. They rose about 2% on Tuesday morning.
What this means for you: If you run a business that takes UPI payments above Rs 2,000, the 0.4% fee will reach you once NPCI sets a date. Small merchants taking up to Rs 1 lakh a month through a UPI QR code stay at zero, so check which category you are in.
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