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The central bank on Thursday said its action against Paytm was driven by a “lack of compliance.” We decode this and more in today’s ETtech Top 5.

Also in this letter:

■ SoftBank posts $6.6 billion profit

■ Microsoft partners with Sarvam AI

■ Orient Growth closes $90 million fund


Paytm’s persistent non-compliance led to action: RBI


RBI Paytm

The Reserve Bank of India (RBI) said its crackdown on Paytm Payments Bank’s business was forced by persistent non-compliance of norms.

Driving the news: “The regulatory actions were taken after giving the firm sufficient time to comply,” RBI deputy governor Swaminathan J said at a press conference following the monetary policy review today.

Without naming a specific entity, RBI Governor Shaktikanta Das said the regulatory action was driven by a “lack of compliance”. This is the first time the regulator has spoken on the matter since its January 31 order.

Paytm Money Print GFX

“When constructive engagement doesn’t work or when the regulated entity does not take effective action, we go for imposing business restrictions,” Das said, adding that the actions are “proportionate” to the gravity of the situation.

Paytm says services unaffected: Hours after the RBI governor’s remarks, Paytm issued a statement assuring its users and merchants that its services remain unaffected.

“We assure our merchant partners that Paytm QR, Soundbox and card machines will continue to work as always. Our dedication to providing seamless payment solutions and promoting financial inclusion across India remains as strong as ever,” it said.

Dos and don’ts: Das said the RBI will be coming out with a set of FAQs (frequently asked questions) to assuage the sector’s concerns.

While announcing the Monetary Policy Committee’s decision, Das also said that good governance, robust risk management, sound compliance culture and protection of customers’ interest are of paramount importance for the safety and stability of the financial system and individual institutions.

Opinion | RBI has sown scepticism among payment cos & it may want to reconsider its position

Paytm shares nosedive: Shares of crisis-ridden One 97 Communications were under stress again on Thursday, ending the day down 10% on the BSE at Rs 447.10.

paytm stock

Source: BSE

Catch up quick: Meanwhile, Central Depository Services India (CDSL) is the latest to ramp up checks on the know-your-customer (KYC) process followed by various entities of One 97, we reported.

Moreover, banks interested in taking over the payments business from Paytm Payments Bank are wary of the source of funds in its nodal accounts and may insist on undertaking fresh KYC of the merchant base, two bankers told us.

HDFC Bank, Axis Bank and Yes Bank are among the banks eyeing Paytm’s business. We reported on February 5 that banks are awaiting the green signal from the RBI before entering into a business transaction with Paytm Payments Bank.

Also read | What’s stopping rivals from lining up to pick up Paytm’s talent pool

Read our detailed coverage on the Paytm crisis:


Zomato profit jumps nearly fourfold QoQ to Rs 138 crore


Deepinder Goyal

Zomato CEO Deepinder Goyal

Food-delivery company Zomato’s third-quarter earnings beat estimates on the back of robust growth in its food-delivery and hyperpure businesses. Net profit jumped nearly 4x (283%) quarter-on-quarter (QoQ) to Rs 138 crore. The company had posted a loss of Rs 347 crore in the year-ago period.

Key numbers:

  • Revenue from operations rose 69% year-on-year to Rs 3,288 crore.
  • Food-delivery business GOV (gross order value) grew 27% YoY.
  • Quick-commerce (Blinkit) GOV more than doubled YoY.



Consumption slowdown:
Zomato said that a broader slowdown in discretionary consumption had crimped the growth of its mainstay food-delivery business, which grew at a slower-than-expected pace. Zomato’s food-delivery CEO Rakesh Ranjan pointed out that in a muted demand environment, the growth was being driven by restaurant addition.

Also read | Price rise, funding slump may dampen cloud kitchen growth

Blinkit trims losses: Zomato said Blinkit’s losses continue to decline and it is on track to meet the guidance of adjusted Ebitda breakeven on or before Q1FY25.

Food-delivery revenues increased 29% YoY to Rs 2,025 crore and quick-commerce revenues jumped 114% YoY to Rs 859 crore. The quick-commerce business growth was largely driven by the robust uptick in demand during the festive season and other events like the cricket World Cup.

Also read | Blinkit’s revenue from ads sees over threefold surge in Q3

On Hyperpure: Zomato’s business-to-business grocery supply unit Hyperpure’s revenue soared 104% YoY to Rs 859 crore, driven by growth in both the core restaurant supplies business and the relatively newer quick-commerce opportunity.

More restaurants: The monthly active restaurant base on Zomato has grown by more than 20% YoY in Q3FY24, led both by new restaurants opening up and the coverage of existing restaurants increasing.

Also read | Zomato hits pause on Blinkit integration to focus on building super brands


SoftBank posts $6.6 billion profit, first in five quarters


Masayoshi Son

SoftBank CEO Masayoshi Son

Japan’s SoftBank Group returned to profit for the first time in five quarters, as the Japanese tech investment firm was buoyed by an upturn in portfolio companies, sparking hope that it was emerging from a period of retrenchment.

Key numbers: Net profit totalled 985.5 billion yen ($6.6 billion) in the three months to December, versus a 744.7-billion-yen loss in the same period a year earlier.

Low activity phase: Founded by Masayoshi Son, SoftBank and its Vision Fund investment arm have gone through a period of slashing investment activity and selling assets. Stakes in high-growth startups were particularly hit as risk appetite waned during the pandemic and its aftermath.

What’s more: While SoftBank’s results are often volatile, the latest numbers could give investors some relief: quarterly net income surpassed market expectations and the closely-watched Vision Fund arm booked an investment profit of 600.73 billion yen.

Also read | SoftBank took home $1.8-1.9 billion from four listed portfolio companies

Quote, unquote: SoftBank was again on a “growth trajectory”, chief financial officer Yoshimitsu Goto said, adding that market conditions and the outlook were both “very positive”.

Vision Fund: The Vision Fund earnings got a boost due to increased valuations for holdings such as ride-hailing company Didi Global, TikTok owner ByteDance and robotics firm AutoStore Holdings. Meanwhile, its investment in office-sharing company WeWork was written down to zero in the quarter.

On new investments: While new investment activity in the quarter was minimal, Goto said this was simply a matter of timing and that the investment pipeline was building up. He added that SoftBank’s first priority was to use its ample liquidity – including 4.4 trillion yen in cash, cash equivalents and liquid bond holdings – to make new investments.


Microsoft partners with Chennai-based Sarvam AI for genAI tools


Microsoft Sarvam AI

Microsoft CEO Satya Nadella

Microsoft will support the development of voice-based generative artificial intelligence (AI) applications through a partnership with Indian startup Sarvam AI, the company said.

Deal details: Sarvam AI is working with Microsoft to make its Indic voice large language model (LLM) available on Azure, it said. The AI startup will use Microsoft’s cutting-edge cloud and AI infrastructure – including Azure OpenAI Service and Azure Machine Learning – to train, host, and scale its LLMs quickly and efficiently.

Also read | Microsoft to train 2 million Indians in AI by 2025: Satya Nadella

The announcement comes during CEO Satya Nadella’s three-day visit as the company pushes for wider adoption of its products by consumers in India.

More about SarvamAI: Sarvam AI is building genAI models targeting Indic languages and context. Its Indic voice LLM will initially be available in Hindi.

The startup has raised $41 million in funding from Lightspeed Venture Partners, Peak XV Partners and Khosla Ventures.

Nadella’s India visit: Nadella on Thursday said the momentum around developers and development in India is “unbelievable.” He also announced the expansion of the ‘Code Without Barriers’ initiative to India which he said would help 75,000 women developers by 2024.

What is ‘Code Without Barriers’? Microsoft’s programme aims to train 75,000 women developers by 2024. It provides support, training, and networking opportunities for female developers and coders, and those in other technical roles to contribute to inclusive economic growth, encourage innovation, and reflect the region’s social makeup

The programme is to democratise access to tech skills nationwide, Nadella said.

Also read | Imperative for India, US to cooperate on AI norms, other regulations: Satya Nadella


Orient Growth Ventures closes second India and South East Asia fund at $90 million


Orient Ventures

Orient Growth Ventures cofounders Ricardo Bun (left) and Rinze Verbeek

Dutch investment firm Orient Growth Ventures, which is a limited partner in venture capital firms including Blume Ventures, Jungle Ventures and Chiratae Ventures, has announced the close of its second India and Southeast Asia fund at $90 million.

Details: Through the Orient Growth Fund-II, the firm aims to increase its investment in India by backing early-stage venture capital firms, managing partner Rinze Verbeek told ET. Orient Growth Ventures’ first fund, raised in 2020, had a corpus of $25 million.

Quote, unquote: “Similar to our first fund, this second fund also concentrates on early-stage venture capital opportunities in India and Southeast Asia. While our first fund did include some investments outside of these regions, we have grown increasingly convinced of the promising development within India and Southeast Asia’s VC ecosystems,” Verbeek said.

Today’s ETtech Top 5 newsletter was curated by Megha Mishra in Mumbai and Erick Massey in New Delhi.

Harry Byrne

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