One97 Communications, the parent company of Paytm, has linked its payment gateway with Anthropic’s Claude AI to help merchants manage data through simple text prompts. Shares of the company rose 9% today, hitting a 52-week high, as investors reacted to this technological update and the company's recent milestone of reporting its first full-year net profit of ₹552 crore for FY2026.
One97 Communications has introduced an AI-powered upgrade for its payment gateway, Paytm Payments Services Limited (PPSL). By using the Model Context Protocol (MCP), the company now allows merchants to interact with their financial data using simple language commands through Anthropic’s Claude AI. This feature is designed to save time for businesses that previously relied on navigating complex dashboards for daily tasks like reconciliation or checking transaction statuses.
The company's stock responded positively to this development, climbing about 9% on August 10, 2026, to reach a new 52-week high. This market sentiment is also supported by recent positive analyst notes, including a target price upgrade from brokerage firm Bernstein.
This technological rollout follows a significant financial milestone for the company. In fiscal year 2026, One97 Communications reported its first-ever annual net profit of ₹552 crore. This shift from past losses was driven by a combination of steady revenue growth, strict cost control, and a strategic focus on distributing financial services, such as credit products.
For merchants, this AI integration aims to make back-end operations smoother. Instead of needing to pull reports manually or switch between multiple software tabs, business owners can ask the AI about specific collections or refund statuses. Importantly, Paytm has clarified that this AI tool is strictly for information retrieval. It does not perform actual financial transactions, such as executing payments or processing refunds, which remain under the merchant's secure, pre-existing control.
While the integration offers convenience, investors should keep the broader sector challenges in mind. The payment gateway business in India remains highly competitive, which can put pressure on profit margins. Furthermore, the government’s Zero-MDR (Merchant Discount Rate) policy on UPI transactions limits direct fee income, forcing companies like Paytm to rely on other streams, such as lending and device subscriptions, to sustain growth.
Additionally, as the company embraces AI for data access, protecting sensitive merchant information from potential security threats remains a vital monitorable for stakeholders. Looking ahead, market participants will likely track how quickly merchants adopt these AI tools and whether the company can continue to protect its profitability amidst the stiff industry competition.