Paytm is preparing to commercialise internally built AI tools for merchants and enterprises, adding a new software-led revenue track alongside payments, financial services, wallet revival efforts and wealth-management expansion. Founder and chief executive Vijay Shekhar Sharma told investors during the company’s Q1 FY27 earnings call that Paytm has begun generating revenue from some AI products and intends to package tools developed for its own operations for external customers.
The proposed AI offerings are expected to cover merchant acquisition, customer engagement, collections, customer support and business automation. Paytm has fine-tuned open-source models and runs them on its own infrastructure to reduce computing and customer-support costs. Revenue from these tools is expected to be reported under the company’s commerce and cloud business. Sharma said some AI products are already producing revenue in the range of a few lakh rupees, positioning the initiative as an early commercial line rather than only an internal productivity programme.
The AI strategy comes after one of Paytm’s stronger recent quarters. One97 Communications reported consolidated net profit of Rs 220 crore for Q1 FY27, up 78.8% year-on-year, while revenue rose 27.6% year-on-year to Rs 2,448 crore. The company attributed the performance to merchant payments, merchant loan distribution, consumer payments, improved monetisation through wealth products and operating leverage from AI deployment.
Paytm is also continuing work around the possible revival of its wallet business, though management did not provide an update on its pending application with the Reserve Bank of India for a prepaid payment instrument licence. The company’s board has approved investment of up to Rs 100 crore in Paytm Money, and Sharma said Paytm will expand equity broking, mutual fund and margin-trading businesses over the next four quarters.
The company’s move points to a broader shift in Indian fintech from transaction-led scale toward margin improvement, software monetisation and deeper financial-services engagement. AI is being positioned not only as an efficiency layer but as a product set that could be sold to the same merchant and enterprise base Paytm already serves. Sharma has also indicated that AI, combined with higher-margin financial services and software products, could eventually support EBITDA margins above the 15%-20% range.
The execution challenge will be to convert internal tooling into reliable enterprise-grade products with clear pricing, support, compliance and measurable customer outcomes.
