New Delhi: Paytm announced that Paytm General Insurance Ltd. (PGIL), an associate entity, is withdrawing its application for a general insurance license to concentrate on providing insurance through its fully-owned subsidiary, Paytm Insurance Broking Private Ltd. (PIBPL). This move allows One97 Communications Ltd. (OCL) to save Rs 950 crore initially allocated for investment in PGIL.
In May 2022, One97 Communications Ltd. had revealed plans to increase its stake in PGIL to 74% with an investment of up to Rs 950 crore. However, the company is now focusing on PIBPL to enhance insurance distribution to Paytm users, small merchants, and SMEs. PIBPL aims to offer innovative, small-ticket insurance solutions across various general insurance segments such as health, motor, shop, life, and gadgets.
PIBPL has strengthened partnerships with notable insurance companies including Digit, Acko, ICICI Lombard, New India, Bajaj Allianz, Tata AIG, Aditya Birla Health, and Universal Sompo. A Paytm spokesperson stated in a regulatory filing, “PIBPL provides affordable, easy-to-understand insurance products to our consumers and merchants, simplifying their daily lives. By concentrating on small-ticket general insurance offerings and leveraging Paytm’s extensive distribution network, we are dedicated to increasing general insurance penetration among a broader audience.”
Recently, Paytm released its Q4 FY24 results, reporting a net loss of Rs 550 crore, compared to a net loss of Rs 168.4 crore in the same quarter the previous year. The company’s revenue from operations also fell to Rs 2,267 crore from Rs 2,334 crore year-over-year. According to a regulatory filing, the Q4 results were affected by the embargo on Paytm Payments Bank and disruptions caused by the UPI transition.
