Paytm shares surge 5% as enterprise AI service targets banks, insurers across India and UAE

Paytm shares rally on enterprise AI expansion

Paytm shares climbed 5% on Wednesday as One97 Communications announced its foray into enterprise AI with a new service called Paytm Intelligence, or Pi1

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. The stock reached an intraday high of Rs 1,753 on the National Stock Exchange, up from the previous close of Rs 1,670. Over the past month, Paytm shares have gained 20.21%, significantly outperforming the Nifty 500, which declined 1.15% during the same period1

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Paytm Intelligence targets financial institutions with AI agents

The workplace AI push centers on selling AI agents to enterprise customers, initially targeting banks, small lenders, insurers and other financial institutions in India and the United Arab Emirates1

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. Paytm Intelligence will deploy AI agents across functions such as sales, customer service and operations, capable of performing multiple workplace tasks with minimal human supervision1

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. This represents a significant departure from Paytm's core consumer and merchant payments operations and associated businesses such as lending and investment-product distribution1

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Financial services model built on two years of development

Paytm's AI platform is built around a financial services model that the company has been developing for approximately two years1

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. The model is trained on massive data sets amassed from processing millions of financial transactions and analyzing customer behavior2

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. Drawing on transaction and customer-behavior data, the model can assess fraud, creditworthiness and the credibility of insurance claims1

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. According to Paytm's official website, Pi offers three main products: a sales and marketing agent, a customer-service agent and an operations agent1

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Low-cost AI model with 4 billion parameters drives efficiency

Founder and CEO Vijay Shekhar Sharma revealed during the Q1 FY27 earnings call that Paytm had built a low-cost AI model optimized with 4 billion parameters, featuring low latency and using fewer tokens than popular models2

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. "We have removed the call centre cost. We will sell it to other businesses," Sharma stated2

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. The company already operates more than 100 voice and chat AI agents across its businesses1

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. These tools can automate lead generation, customer onboarding, collections, loan processing, compliance checks, refunds and record reconciliation1

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AI adoption creates competitive advantages and revenue opportunities

Analyst Diksha Gera noted that AI adoption could create a sharp performance divide among fintech companies, with leaders using proprietary data and model-feedback loops to strengthen their competitive position1

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. Companies that lag could face margin pressure as AI-native rivals raise expectations around speed, accuracy and personalization1

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. Embedded AI models and automation could reduce the cost of serving customers while creating new businesses such as agentic commerce, a market projected to reach $1.7 trillion by 20301

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Revenue generation already underway from AI products

Sharma emphasized that AI has already begun generating revenue for Paytm. "I fundamentally believe that going ahead, we will start to see a revenue monetisation journey of AI," he said, highlighting that some AI products have already started generating a few lakhs in revenue2

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. Management indicated Paytm was looking to scale its AI revenue into a meaningful business within less than a year, which would be reported under the Commerce Cloud line item2

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. The move could open higher-margin revenue streams as competition limits expansion opportunities in digital payments1

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Record profitability supports strategic expansion

Paytm reported record profitability in the June quarter, with Q1 FY27 revenue rising 28% year on year and 8% sequentially to Rs 2,448 crore1

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. Quarterly EBITDA reached an all-time high of Rs 203 crore, surging 182% year on year and 54% quarter on quarter, supported by broad-based growth across payments and financial-services businesses and AI-led operating leverage1

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. Sharma has identified agentic AI as a major focus for the company, which is developing models tailored for Indian languages, voice-based services and small businesses1

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Broader fintech sector embraces agentic AI capabilities

Paytm is not alone among fintech companies jumping on the agentic AI bandwagon. In March, Razorpay and Sarvam AI announced they had built a voice-first system where an AI agent understands commands in Indian languages and can complete food orders and payments without a PIN at checkout2

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. Last month, Razorpay rolled out Vulcan, claiming it was India's first transformer-based AI foundation model for payments, supporting payment routing, fraud detection, risk assessment and personalization2

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. Customers including Blinkit, Bachatt and redBus had started using some of its capabilities in live payments2

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