New Delhi, September 18, 2026 (Yes Punjab News)
Global brokerage Bernstein has raised its earnings estimates for Paytm after the final framework for the Unified Payments Interface (UPI) merchant discount rate (MDR) came in better than expected, pointing to improved monetisation prospects for the company’s payments business.
Bernstein said the framework provided a more favourable outcome for consumer payment apps, with third-party application providers (TPAPs) now set to earn an MDR broadly comparable to merchant-facing apps. Their share of the MDR pool has also been explicitly defined.
The brokerage said the greater clarity around consumer-side economics is particularly significant for Paytm, which operates across both consumer and merchant segments of UPI payments.
For Paytm, Bernstein raised its assumed consumer-side MDR take rate — the portion of each transaction earned by the company — to 8 basis points from 3 basis points earlier. Its merchant-side assumption was increased to 10 basis points from 9 basis points.
Factoring in implementation from mid-October 2026, Bernstein said the revised assumptions would increase its FY27 earnings estimate for Paytm by around 27 per cent.
The larger revision came on the consumer side, where the assumed MDR take rate was raised from 3 basis points to 8 basis points, bringing it closer to the brokerage’s estimate for Paytm’s merchant-side economics.
Bernstein estimates that the overall UPI person-to-merchant (P2M) revenue pool could reach around Rs 27,000 crore in FY28. Payment apps are expected to collectively retain around 40-45 per cent of the total MDR pool, translating into an annual revenue opportunity of approximately Rs 11,000 crore to Rs 12,000 crore by FY28.
The brokerage expects UPI P2M transaction value to increase from around Rs 100 lakh crore over the last 12 months to approximately Rs 115 lakh crore in FY27 and Rs 144 lakh crore in FY28, representing continued growth of around 27 per cent year-on-year.
Bernstein’s analysis also showed that UPI P2M transactions above Rs 2,000 account for a relatively small proportion of transaction volumes but represent a substantially larger share of payment value. Such transactions accounted for around 4 per cent of UPI P2M volumes in August 2026 but approximately 67 per cent of transaction value.
Following the revised estimates, Bernstein retained its Outperform rating on Paytm and a target price of Rs 2,200, citing stronger assumed economics across the company’s consumer and merchant payments businesses.
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