Paytm UPI migration: 4 bank handles after NPCI nod

What NPCI has cleared for Paytm

One 97 Communications (OCL), which operates the Paytm brand, has received permission from the National Payments Corporation of India (NPCI) to begin migrating users to new bank-linked UPI handles. The move allows Paytm to continue offering UPI services through partner banks, rather than through the Paytm Payments Bank handle that many users currently use. The company said the go-ahead enables it to start the user migration to new Payment System Provider (PSP) bank handles immediately. The permission follows NPCI’s earlier approval dated March 14, 2024, which allowed OCL to participate in UPI as a Third-Party Application Provider (TPAP) under a multi-bank model. Paytm has positioned the transition as a continuity step for both customers and merchants. The company has also communicated the development through a stock exchange filing.

Multi-bank TPAP model: what changes operationally

Under the TPAP framework, Paytm runs the app experience while partner banks act as PSPs for UPI processing. Paytm said it has expedited integrations with four banks to support this setup. Those banks are Axis Bank, HDFC Bank, State Bank of India (SBI), and YES Bank. According to the company, all four banks are now operational on the TPAP multi-PSP API model. This operational readiness is central to Paytm’s ability to shift user accounts to the partner PSP banks. The updated arrangement is also linked to prior regulatory restrictions imposed on Paytm Payments Bank by the Reserve Bank of India (RBI), which made continuity planning necessary for Paytm’s UPI services. Paytm’s stated objective is to keep UPI payments seamless for customers and merchants.

Who will be migrated first

Paytm said users with the “@paytm” handle will be the initial group to be migrated. Media reports and company communication indicate that the migration involves shifting UPI IDs away from the existing Paytm Payments Bank-linked handle. Users will be asked to provide consent to use Paytm with a new UPI ID linked to one of the partner banks. The company and reports also indicate that users will be able to choose the bank. This consent-led flow is important because it changes the virtual payment address (VPA) that counterparties may see when receiving payments. Paytm has framed the change as a transition designed to protect service continuity for both individual users and merchants who rely on Paytm for collections.

New UPI handles that users may see

Once migrated, a user’s existing UPI ID with “@paytm” will change to a new UPI ID mapped to one of the four partner handles. Reports listed the new handles as @ptsbi, @pthdfc, @ptaxis, and @ptyes. The intent is that UPI payments continue to work inside the Paytm app, but the underlying PSP bank routing changes. In practical terms, this affects how VPAs are constructed and how identity is represented on UPI rails. The company’s statements focus on uninterrupted UPI payments and AutoPay mandates as the desired outcome of the change. Paytm has also indicated that users can link their existing bank accounts within the app to make UPI payments directly.

Why the migration matters after the RBI action on Paytm Payments Bank

Paytm’s shift to partner PSP banks is closely tied to earlier restrictions placed on Paytm Payments Bank by the RBI. While the article does not detail the full set of restrictions, it explicitly states that the revised setup is essential due to those prior restrictions. With partner banks acting as PSPs, Paytm can keep its UPI proposition running on a bank-backed structure that aligns with NPCI’s TPAP multi-bank model. This is particularly relevant for merchants, where disruption in UPI collections can impact daily cash flows. For consumers, it reduces the risk of failed payments due to handle-level changes at the PSP layer. The migration is therefore both a compliance-led and operations-led restructuring.

Market share context during the onboarding pause

A separate update in the article noted that NPCI has granted approval for OCL to onboard new UPI users again, subject to adherence to NPCI norms and other regulatory guidelines. This came after an onboarding pause that lasted about nine months, during which Paytm’s UPI market share reportedly declined. The reported figures show Paytm’s UPI market share falling from about 13.3% in January to 7% in September. Even after the decline, the report described Paytm as the third-largest player in the UPI ecosystem. The update also mentioned that around 13.5 crore UPI customers had already been migrated to the new OCL platform supported by the four banks.

Stock market reaction: what the numbers showed

Paytm’s parent OCL saw a positive move in the stock after the migration approval.

Separately, the article also reported that the stock closed 0.45% higher at ₹391.35 on a Tuesday, while the Sensex fell 0.6% the same day. It also reported longer-period performance: the stock had declined 58.65% over six months and 39.22% over one year.

Key entities and ownership detail highlighted

The migration plan is being executed by One 97 Communications, which owns the Paytm brand. The article also cited an ownership detail related to Paytm Payments Bank (PPBL): OCL holds a 49% stake in PPBL, while founder and CEO Vijay Shekhar Sharma holds 51%. The banking partners for the PSP role in this phase are SBI, Axis Bank, HDFC Bank, and YES Bank. NPCI is the approving body for participation in UPI and for the TPAP framework used in the multi-bank model. The shift therefore spans product operations, banking integrations, and regulatory compliance.

What users and merchants should watch during the transition

The user-facing change is the VPA handle migration from “@paytm” to one of the partner bank handles, after user consent. For merchants and payers, the most visible change could be the UPI ID that appears for the same Paytm user. Paytm’s communications emphasise that the objective is uninterrupted UPI payments and AutoPay mandates. The company has said it has already started transitioning “@paytm” handle users to the new structure. Future updates are likely to be communicated through Paytm app prompts and exchange filings as the migration progresses under NPCI norms.