Shares of One 97 Communications Ltd, One Mobikwik Systems Ltd, Pine Labs and AvenuesAI tumbled 10 per cent in Thusrday's trade amid reports that the authorities are considering delaying the introduction of merchant discount rates (MDR) on UPI transactions to January 1, 2027 from October 15, 2026. MDR on large-ticket UPI transactions was seen as a significant catalyst for fintech profitability.
To recall, MDR of up to 0.4 per cent on UPI Person-to-Merchant (P2M) transactions exceeding Rs 2,000 was announced earlier, leading to rally in fintech shares. For Paytm, UPI P2M constituted 85 per cent of gross merchandise value (GMV), of which 35 per cent by value is MDR-eligible. For Pine Labs, Emkay earlier estimated UPI P2M GTV of Rs 3 lakh crore in FY28 (12 per cent of DITP GTV), of which 86 per cent by value sits above the threshold, giving MDR-eligible GTV of Rs 2.58 lakh crore (10 per cent of DITP GTV).
Citing people familiar with the matter, Business Standard reported that the final decision with be taken in the next few days. Such a move would keep UPI payments free for merchants through the festive season amid pushback from retail investors, Bloomberg reported. A panel headed by National Payments Corporation of India is likely to meet today to discuss the issue, as per the report.
Paytm shares were locked at 10 per cent lower circuit limit of Rs 1,734 apiece on BSE. This was the biggest fall for the stock since February 1.
Paytm shares fell even as Goldman Sachs analyst Manish Adukia upped target of the stock to Rs 2,070 from Rs 1,500, citing strong underlying market share, revenue growth and margin momentum. He noted that recently announced UPI MDR was expected to drive up to 40 per cent Ebitda upgrades for Paytm and felt it was not fully reflected in current share price.
One Mobikwik Systems plunged 8.35 per cent to Rs 234.60. At 9.28 am, Pine Labs Ltd shares were quoting at Rs 170.60, down 3.91 per cent. AvenuesAI Ltd was down 2.44 per cent at Rs 15.18.