Building AGI stack to shield against potential frauds, says Paytm CEO

Paytm is building an Artificial General Intelligence (AGI) software stack that can potentially shield the company from possible risks and frauds, lower costs, and also serve India’s financial ecosystem in the future.

Earlier this month, Paytm, India’s biggest digital payments company, reported an impressive 20 per cent jump in monthly users during the July to August period to an average of 94 million.

“With the focus on AGI, India will soon become a global superpower, and we will lead this,” Vijay Shekhar Sharma, the founder and chief executive officer (CEO) of Paytm, said during the company’s 23rd annual general meeting (AGM) on Tuesday.

The AGI software stack will create opportunities to lower costs, make our financial system safer and secure, Sharma said.

He noted that with an eye on safety, security and on the various risks involved in financial services, Paytm’s AGI stack will also serve India’s financial services ecosystem for decades to come.

Last month, in a letter to the company’s shareholders, Sharma noted that AI can be used for the Indian market and also be leveraged outside the country.

“We are constructing an India-scale AI system, which will aid financial institutions in identifying potential risks and frauds, while simultaneously shielding them from new types of risks arising from advancements in AI,” Sharma had said. 

He explained that AI can be harnessed for small mobile-led credit in compliance with regulator’s guidelines. 

The company recently launched a suite of its soundbox devices for merchants, which includes a card soundbox for UPI and credit/debit card transactions, music soundbox and a debit-card sized pocket soundbox.

The company has deployed around 8.7 million soundbox and point-of-sale devices to date. 

Paytm competes with payments systems run by Alphabet’s Google and Walmart’s PhonePe in India.

“Our recent launches of soundbox devices show how we understand the needs of the Indian merchants and consumers. We are expanding our deployment each quarter, with more innovative payment devices to bring technology in every shop in India,” he said. 

The company said there are around 50 million merchants in India who use quick response (QR) codes for payments.

It is expecting the number of merchants using QR to touch 100 million soon. 

“We are bringing technology to merchants that can help them grow their business, make their life seamless. We will continue to innovate, as we have been the first to launch many products in the country,” said Madhur Deora, Paytm’s executive director, president, and chief financial officer. 

With a cash balance of Rs 8,300 crore, the company said it is confident of becoming free cash flow in the near future. 

“We don’t see the need for funding in the near future. We have zero debt, and are healthy from a balance sheet standpoint,” Deora added.

Sharma is the largest shareholder in the company, with a stake pegged at 19.42 per cent, after he purchased a 10.3 per cent stake in the company from Antfin (Netherlands) Holding BV in a no-cash deal last month. 

In Q1, its losses came down to Rs 358.4 crore, from Rs 645.4 crore during the same period in the previous year.

The parent company of Paytm, One97 Communications, saw its shares tank 4.3 per cent to Rs 864.95 at the BSE on Tuesday.