One 97 Communications Ltd

Dear Members,

The Board of Directors ("Board") hereby submits the 25^th Annual Report on the business and operations of One 97 Communications Limited ("Company" or "Our" or "We" or "Paytm") together with the Audited Standalone and Consolidated Financial Statements for the financial year ended March 31, 2025 ("FY 2024-25"). Wherever required, the consolidated performance of the Company and its subsidiary(ies) has also been provided.

Financial Performance

The standalone and consolidated financial highlights of the Company's operations are summarized below:

(Amounts in H Millions, except earnings per share)

State of the Affairs of the Company / Operational Highlights

FY 2024-25 marked a pivotal period for Paytm, characterized by an unwavering focus on its core payments and financial services distribution businesses. The Company demonstrated significant operational resilience and strategic agility, successfully navigating transitions and laying a robust foundation for future growth and profitability. This period was defined by strengthening market leadership, expanding merchant ecosystem penetration, enhancing financial services distribution, and optimizing the balance sheet through the monetization of non-core assets. The Company successfully transitioned to a Third-Party Application Provider (TPAP) for the UPI business, establishing strategic

partnerships with leading banks, including Axis Bank, HDFC Bank, State Bank of India, and YES Bank. This transition involved efficiently migrating users from the @paytm handles to new bank handles—@pthdfc, @ptaxis, @ptsbi and @ptyes. On October 22, 2024, the National Payments Corporation of India (NPCI) granted approval for Paytm to onboard new UPI users. This approval marked a significant milestone, leading to an increase in the Average Monthly Transacting Users (MTU) from a low of 7.0 Cr in Q3FY 2025 to 7.2 Cr in Q4FY 2025 (20 lakh sequential growth).

Your Company continued to solidify its undisputed leadership in merchant payments, driven by innovative products, a large and dedicated field team, and robust service infrastructure. Our first-to-market payment

innovations, including QR, Soundbox, and All-in-One POS card machines, continued to drive acceptance across MSMEs and enterprises. The network of device merchants grew rapidly, with the device merchant subscriber base reaching 1.24 Cr by March 2025 from 1.07 Cr the previous year. This growth, including 8 lakh subscribers added in Q4FY 2024-25 alone, reflected the effectiveness of innovative offerings and a dedicated field force. The Company reaffirmed its commitment to empowering India's MSME sector, recognizing its immense potential. Efforts focused on expanding the distribution network, particularly in Tier-2 and Tier-3 cities, leveraging significant penetration opportunities. New Soundbox variations, such as India's first Solar-powered Soundbox and Double Battery Soundbox, were launched to meet diverse merchant needs and enhance transaction tracking and privacy. Furthermore, honoring India's cultural heritage, we launched "Bhavya Mahakumbh QR" and "Mahakumbh Soundbox", and deployed iconic Soundboxes and Card Machines at Maha Kumbh 2025, the world's largest spiritual gathering, demonstrating our commitment to both merchant empowerment and national initiatives.

Your Company is uniquely equipped to capitalize on the merchant loan opportunity, leveraging its extensive merchant acquiring network, largest payment device base, and longstanding partnerships with banks and NBFCs. Merchant loan distribution saw significant growth, increasing 24% YoY to H13,958 Cr, with over 50% distributed to repeat borrowers, reflecting strong product- market fit. While the majority of loans distributed were under DLG model in FY 2024-25, however our largest lending partner transitioned to a non-DLG model in Q1FY 2025-26 and we expect a higher share of non-DLG loans going forward. The personal loans segment shows early signs of recovery in the credit cycle, with an expectation for this trend to continue through the next financial year. We are steadily investing in growing our equity broking and mutual fund distribution businesses by providing high- quality trading platforms with low transparent costs. Paytm Money Limited, our wholly owned subsidiary, has launched Margin Trading Facility (MTF) and is now registered as a Research Analyst to deliver insightful research to investors. Additionally, we are expanding mutual fund distribution by promoting SIPs and other wealth management products.

The year was marked by a continued focus on our core payments and financial services distribution businesses. We monetized non-core assets, including the PayPay stake and the movies and events business, at an attractive valuation of over H2,000 Cr each, that helped to significantly strengthen the Company's balance sheet, providing enhanced capital flexibility for future growth initiatives.

Key aspects of our Company's consolidated performance during FY 2024-25 are as follows:

• The Company reported an operating revenue of H6,900 Cr. The Company achieved a contribution profit of H3,678 Cr, resulting in a contribution margin of 53%. The EBITDA stood at H(1,507) Cr. The Profit After Tax (PAT) for the year was H(663) Cr, which included exceptional gains of H1,346 Cr from the sale of the entertainment ticketing business. Profit After Tax (PAT), excluding exceptional items, continued its improving trend, narrowing to H(23) Cr in Q4FY 202425, and is close to breakeven. Further in Q1FY 2025-26, the Company achieved the milestone of profitability and has reported EBITDA and PAT of H72 Cr and H123 Cr respectively as disclosed on July 22, 2025.

• Our merchant loan distribution business significantly expanded from H1,386 Cr in FY 2021-22 to H13,958 Cr in FY 2024-25, supported by a 4.3x increase in our device merchant base, a rise in penetration to 5.4% from 3.5% despite a conservative credit quality approach, and a 1.5x increase in average ticket size to H2.1 Lakh. The personal loans segment shows early signs of recovery in the credit cycle and we anticipate these positive trends to persist.

• The number of device merchants continued to grow, reaching 1.24 Cr by the end of March 2025, representing a CAGR of 63% (4.3x increase) since March 2022. Average Monthly Transacting Users (MTU) also increased from 7.0 Cr in Q3FY 2025 to 7.2 Cr in Q4FY 2025, despite limited marketing spending.

• Gross Merchandise Volume (GMV) of payments facilitated through our platform during FY 2024-25 experienced a 3% YoY growth, reaching H18.9 Lakh Cr, compared to H18.3 Lakh Cr in FY 2023-24. For our continuing businesses™, GMV increased 19% YoY driven by the increasing adoption of mobile payments and the expansion of our merchant network. UPI remained a significant contributor to GMV, but we also observed growth in non-UPI instruments like EMI and cards, mainly due to the deployment of more payment devices. Our goal is to lead the acquiring side of the payments business by increasing manpower on distribution and continuing to innovate on devices.

Your Company is an early and aggressive adopter of AI, integrating its potential into every product and service journey. It builds AI-first platforms to gain deep contextual data insights and drive enhancements and efficiencies in its business, moving towards a "machine first, supervised by humans" workflow. These AI integrations have accelerated product development, enhanced risk and

fraud management, and improved customer experience, fueling its next phase of growth. The Al-led operating leverage has contributed to the Company's profitability, as seen in its EBITDA and PAT profitability. Additionally, the Company believes its technology-led merchant payments and financial services distribution model has the potential for expansion in international markets with subsidiaries approved for incorporation in the UAE, Kingdom of Saudi Arabia, and Singapore in January 2025. The Company expects results from these efforts will start showing after 3 years.

In FY 2024-25, the Company successfully executed significant operational and compliance initiatives to transition away from PPBL's services, establishing new banking partnerships to maintain uninterrupted UPI, card acquiring, nodal account, and BBPS services for both customers and merchants.

Our subsidiary Paytm Payments Services Limited (PPSL) offers payment aggregator and payment gateway services and has resubmitted its Payments Aggregator (PA) application to the RBI, following government approval of OCL's downstream investment into PPSL on August 27, 2024, and approval is awaited.

Paytm Money Limited (PML), our subsidiary, offers a platform to customers for trading in equities and investment in mutual funds, and has launched new offerings like Margin Trading Facility (MTF) and Research Analyst services.

Our subsidiary Paytm Insurance Broking Private Limited (PIBPL) operates as an insurance broker leveraging Paytm's platform and customer base to offer a range of products across auto, life and health insurance along with embedded and DIY products to both consumers and merchants.

One97 Communications Singapore Private Limited (OCL Singapore), is a wholly owned foreign subsidiary, and during the year under review completed the sale of all the Stock Acquisition Rights (SAR) held by it in PayPay Corporation, Japan at an attractive valuation of over H2,000 Cr.

One 97 Communications India Limited (OCIL), our subsidiary, offers innovative fintech solutions primarily for banks and financial institutions including various payment switches.

Material Changes and Commitment affecting financial position of the Company

There were no material changes between the end of the FY 2024-25 and the date of this report, affecting the financial position of your Company.

Dividend

As the Company does not have profits during the year under review, the Board does not recommend any dividend for FY 2024-25.

Further, pursuant to Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations"), the Company adopted the Dividend Distribution Policy and the same is available on the website of the Company at https://ir.paytm.com/ policies-and-guidelines.

Transfer to Reserves

During the year under review, the details of the amount transferred to other reserves (including ESOP Reserve), forms part of note no. 11(b) of the standalone financial statements and note no. 10(b) of the consolidated financial statements of the Company which forms part of this Annual Report.

Particulars of Loans, Guarantees or Investments

The particulars of loans, guarantees and investments as on March 31, 2025, covered under Section 186 of the Companies Act, 2013 ("Act") are given in note nos. 5, 6 and 7 of the standalone financial statements and note nos. 5 and 6 of the consolidated financial statements which form part of this Annual Report.

Subsidiaries, Associates and Joint Ventures

As of March 31, 2025, the Company has 26 subsidiaries, 11 associates and 3 joint ventures, which are strategically structured to support its diverse business objectives. Several subsidiaries are established to comply with regulatory requirements for specialized operations, such as stock broking, insurance broking, and payment aggregation, governed by SEBI, IRDAI, and RBI. The Group also includes subsidiaries in international markets to drive its marketing cloud business, enabling local compliance and market expansion. Certain entities, acquired through third-party transactions, bring specialized capabilities and are integrated to enhance synergy. Purpose-specific subsidiaries allow focused management of distinct business lines, optimizing operational efficiency and risk segregation. This structure aligns with the Company's growth strategy and is supported by robust governance practices. The Board and Audit Committee oversee all entities, ensuring compliance with the Act, and SEBI Listing Regulations. During the year under review, following Companies ceased to be subsidiaries/ associates:

• Wasteland Entertainment Private Limited (w.e.f. August 27, 2024);

• Orbgen Technologies Private Limited (w.e.f. August 27, 2024);

• Xceed IT Solutions Private Limited (w.e.f.

February 21, 2025); and

• Socomo Technologies Private Limited (w.e.f.

March 28, 2025).

Further, during the year under review, Paytm Cloud Technologies Limited, our wholly-owned subsidiary ("PCTL"), has acquired 25% stake in Seven Technology LLC, Delaware which is the parent Company of Dinie Correspondente Bancario e Meios de Pagamento Ltda. ("Dinie"). Post consummation of the transaction, Seven Technology LLC and Dinie have become associates of the Company w.e.f. February 13, 2025.

Paytm Arab Payments L.L.C ("Paytm Arab") has been incorporated as a wholly owned subsidiary by PCTL w.e.f April 30, 2025. Paytm Arab is engaged in expansion and distribution of Paytm's technology led merchant payments and financial services stack in UAE and has become a wholly owned step down subsidiary of the Company w.e.f. April 30, 2025.

Paytm Singapore Pte. Ltd. ("Paytm Singapore") has been incorporated as a wholly owned subsidiary by PCTL w.e.f June 03, 2025. Paytm Singapore is engaged in expansion and distribution of Paytm's technology led merchant payments and financial services stack in Singapore and has become a wholly owned step down subsidiary of the Company w.e.f. June 03, 2025.

Paytm Company has been incorporated as a wholly owned subsidiary by PCTL w.e.f. July 17, 2025. Paytm Company is engaged in expansion and distribution of Paytm's technology led digital payments stack in Saudi Arabia and has become a wholly owned step down subsidiary of the Company w.e.f. July 17, 2025.

Paytm Payments Services Limited ("PPSL") is the material subsidiary of the Company under Regulation 16 (1) (c) of SEBI Listing Regulations. The details of PPSL are set out in the Corporate Governance Report which forms part of this Annual Report.

One97 Communications Singapore Pvt Ltd. ("OCL Singapore"), has become a material subsidiary of the Company w.e.f. April 1, 2025 under Regulation 16 (1) (c) of SEBI Listing Regulations.

Pursuant to Section 129(3) of the Act read with Rule 5 of Companies (Accounts) Rules, 2014, a statement containing the salient features of the financial statements of each subsidiary, associate and joint venture in the prescribed form AOC-1 is annexed as Annexure I to this report. The said statement also provides the details of

the performance and financial position of each subsidiary, associate and joint venture.

Further, pursuant to the provisions of Section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited financial statements in respect of the subsidiaries, are available on the Company's website at https://ir.paytm.com/annual-reports.

In compliance with Regulation 16(1)(c) of SEBI Listing Regulations, the Company has formulated a policy for determining material subsidiaries. The said policy is available on the website of the Company at https:// ir.paytm.com/policies-and-guidelines.

Utilisation of Proceeds of Initial Public Offer ("IPO")

Pursuant to Regulation 32 of the SEBI Listing Regulations read with SEBI Master Circular No. SEBI/HO/CFD/PoD2/ CIR/P/2023/120 dated July 11, 2023, the Company confirms that during FY 2024-25, there was no deviation or variation in the utilization of proceeds of the IPO from the objects stated in the Prospectus dated November 11, 2021.

The Monitoring Agency Reports for such utilization are received by the Company from its Monitoring Agency on quarterly basis affirming no deviation in utilization of the issue proceeds from the objects stated in offer documents and are submitted to the Stock Exchanges in compliance with the aforesaid regulation. Details on actual utilization of the Net IPO proceeds are given in note no. 38 of the standalone financial statements and note no. 42 of the consolidated financial statements which form part of this Annual Report.

Employees Stock Option Schemes

The Company grants share-based benefits to eligible employees with a view to attract and retain talent, align individual performance with the Company's objectives, and promote increased participation by them in the growth of the Company.

The Company has two Employees Stock Option Schemes viz. One 97 Employees Stock Option Scheme 2008 ("ESOP 2008") and One 97 Employees Stock Option Scheme 2019 ("ESOP 2019"). After the institution of ESOP 2019 which has been effective from September 30, 2019, no fresh options have been granted to employees under ESOP 2008.

Post IPO of equity shares of the Company, ESOP 2019 has been ratified, confirmed and amended, as per the requirements of 12(1) of the SEBI (Share Based Employee

Benefits and Sweat Equity) Regulations, 2021 ("SEBI SBEB Regulations 2021"), by the Members of the Company through Postal Ballot on February 19, 2022. Further, the Members vide Postal Ballot Notice dated March 11, 2025 have approved the amendments in ESOP 2019 on April 16, 2025 and voting results were announced by the Company on April 18, 2025.

A statement containing relevant disclosures pursuant to Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 and Regulation 14 of the SEBI SBEB Regulations 2021 is available on the website of the Company at www.paytm.com/investor-relations/agm.

During the year under review, the Company issued and allotted 24,31,710 (Twenty Four Lakhs Thirty One Thousand Seven Hundred and Ten) equity shares of H1/- each to its employees pursuant to exercise of vested options by the eligible employees under ESOP 2008 and ESOP 2019. As on March 31, 2025, the issued, subscribed and paid-up capital of the Company stood at H63,78,45,483/- comprising 63,78,45,483 (Sixty-Three Crores Seventy-Eight Lakhs Forty-Five Thousand Four Hundred Eighty-Three) equity shares of H1/- each. The equity shares issued under the said Schemes rank pari-passu with the existing equity shares of the Company.

The Company has obtained a certificate from M/s. VAPN & Associates, Practicing Company Secretaries (Firm Registration No.: P2015DE045500) confirming that

ESOP 2008 and ESOP 2019 have been implemented in accordance with the SEBI SBEB Regulations 2021 and resolution(s) passed by the Members of the Company. The said certificates will be made available for inspection by the Members electronically during business hours.

During the financial year ended March 31, 2022, the Company had granted 21,000,000 Employees Stock Options (ESOPs) to the Managing Director and Chief Executive Officer of the Company, vesting of which was subject to achievement of specified milestones over the prescribed period. The Company has been accounting for ESOPs expenses for the same in accordance with the applicable requirements of Ind AS 102 Share-based Payments.

During financial year 2023-24, the Company received a Show Cause Notice ("SCN") from the Securities and Exchange Board of India ("SEBI") inter alia challenging the above options being in compliance with the SEBI SBEB Regulations 2021. The Company had opted to file a settlement application with the SEBI, under the applicable SEBI (Settlement Proceedings) Regulations, 2018 ("SEBI Settlement Regulations") relating to settlement, whose

application remained under consideration by SEBI as at March 31, 2025.

On April 16, 2025, the Managing Director and Chief Executive Officer voluntarily offered to forego the said ESOPs, which has been noted by the Nomination and Remuneration Committee (NRC) of the Company. In view of the foregoing, the NRC has treated these ESOPs as cancelled. Accordingly, such cancellation has been accounted for by the Company in the financial statements in terms of Ind-AS 102, Share Based Payments, and such options have been returned to the Company's ESOP pool under the ESOP 2019.

As a result of above, the Company has recorded an accelerated charge of H4,924 million as an exceptional item in the statement of Profit and Loss, and the cumulative cost charged to profit and loss account of the Company over the years, pertaining to the above ESOPs, amounting to H40,921 million has been transferred from ESOP Reserve to Retained Earnings of the Company.

SEBI has issued a settlement order dated May 08, 2025, whereby the SCN has been settled in accordance with SEBI Settlement Regulations. The necessary disclosure along with the Settlement Order was filed with Stock Exchanges on May 08, 2025 and is available on the website of the Company.

Transactions with Related Parties

The Company has adopted a Policy on Related Party Transactions ("RPT Policy") in compliance with Regulation 23 of the SEBI Listing Regulations, which is available on the website of the Company at https://ir.paytm.com/ policies-and-guidelines. All the transactions with related parties entered into by the Company during FY 2024-25 were on an arm's length basis and in the ordinary course of business and in the best interest of the Company. The Company had also engaged an independent consultant, wherever necessary, to examine that the transactions were undertaken on an arms' length and at prevailing market rate. The said transactions were entered into by the Company with the prior approval of the Audit Committee.

There were no material related party transactions entered into by the Company during the year under review. Thus, form AOC 2 is not applicable, hence not forms part of this report.

For further details of related party transactions during the year under review, please refer to note no. 25 of the standalone financial statements and note no. 26 of the

consolidated financial statements which form part of this Annual Report.

Directors

As on March 31, 2025, the Board comprised 8 (Eight) Directors with an appropriate mix of Executive Directors, Non-Executive Non-Independent Directors and NonExecutive Independent Directors in compliance with the applicable provisions of the Act and the SEBI Listing Regulations. The Board of the Company consists of eminent individuals of diverse backgrounds with skills, experience and expertise in various areas as detailed in the Corporate Governance Report, which forms part of this Annual Report.

Appointments and Re-Appointments

The Board of Directors of the Company, based on the recommendation of the NRC, appointed Mr. Rajeev Krishnamuralilal Agarwal (DIN: 07984221) as a NonExecutive Independent Director of the Company with effect from June 17, 2024, for a term of 5 (five) years and the Members of the Company approved his appointment on September 12, 2024.

The Board of Directors of the Company, based on the recommendation of the NRC, appointed Mr. Bimal Julka (DIN: 03172733) as a Non-Executive Independent Director of the Company with effect from January 20, 2025 , for a term of 5 (five) years and the Members of the Company approved his appointment on April 16, 2025.

The terms and conditions of appointment of Independent Directors are available on the website of the Company.

Subsequently, after closure of FY 2024-25, Ms. Urvashi Sahai (DIN: 09521316) was appointed as an Additional Director in the capacity of Whole-time Director designated as "Executive Director and General Counsel" and Key Managerial Personnel of the Company with effect from July 22, 2025, for a term of 5 (five) years, by the Board, at its meeting held on July 22, 2025, basis the recommendation of the NRC, subject to approval of the Members of the Company.

All Directors of the Company are qualified to act as a Director as per the requirements of the Act and they are also not debarred from holding the office of Director pursuant to any SEBI order or order of any such authority.

In terms of Section 152(6) of the Act, Mr. Madhur Deora (DIN : 07720350), Executive Director, President & Group

Chief Financial Officer of the Company, retires by rotation at the 25^th Annual General Meeting (AGM) and is not seeking re-appointment. However, he will continue in his full-time role as President and Group Chief Financial Officer of the Company, and will also support the Chief Executive Officer in expanding the business and strengthening profitability.

Resignations

During the year Mr. Neeraj Arora (DIN: 07221836), Independent Director resigned from the Board of the Company with effect from the end of business hours of June 17, 2024.

Subsequently, after closure of FY 2024-25, Mr. Bimal Julka (DIN: 03172733), resigned from closure of business hours of July 22, 2025, as a Non-Executive Independent Director.

The Board places on record its sincere appreciation for the contributions made by Mr. Neeraj Arora and Mr. Bimal Julka for their invaluable services as a Director on the Board. Their insightful contributions have played a pivotal role in steering the Company's strategic direction and fostering growth.

Declaration by Independent Directors

The Company has received declarations from all the Independent Directors confirming that they continue to fulfill the criteria of independence as required pursuant to Section 149, 150 read with Schedule IV of the Act and Regulation 16 and 25 of the SEBI Listing Regulations. All Independent Directors have affirmed compliance with the Code of Conduct for Independent Directors as prescribed in Schedule IV to the Act.

Further, in the opinion of the Board, the Independent Directors of the Company possess the requisite expertise and experience (including proficiency) and are persons of high integrity and repute.

Key Managerial Personnel

Pursuant to the provisions of Section 203 of the Act, following are the Key Managerial Personnel ("KMPs") of the Company as on March 31, 2025:

• Mr. Vijay Shekhar Sharma, Chairman, Managing Director and Chief Executive Officer

• Mr. Madhur Deora, Executive Director, President and Group Chief Financial Officer

• Mr. Sunil Kumar Bansal, Company Secretary and Compliance Officer

During the period under review, there were no changes in the KMPs of the Company.

Subsequently, after closure of FY 2024-25, Ms. Urvashi Sahai (DIN: 09521316) was appointed as an Additional Director in the capacity of Whole-time Director designated as " Executive Director and General Counsel". She has also been designated as a Key Managerial Personnel of the Company with effect from July 22, 2025.

Corporate Social Responsibility ("CSR")

In view of the losses incurred by the Company during the previous financial years, the Company was under no obligation to contribute towards CSR activities during FY 2024-25. However, the Company had voluntarily undertaken certain initiatives during the year under review which were approved by the CSR Committee. A brief outline of the CSR policy of the Company and the activities undertaken during the year are set out in Annexure II to this Report in the format as prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014.

The CSR Policy as adopted by the Company is available on the website of the Company at https://ir.paytm.com/ policies-and-guidelines.

For details regarding the composition and terms of reference of the CSR Committee, please refer to the Corporate Governance Report, which forms part of this Annual Report.

Board Meetings

The Board met 12 (Twelve) times during FY 2024-25. The details of the meetings of the Board and attendance of the Directors at the Board meetings are set out in the Corporate Governance Report, which forms part of this Annual Report. The intervening gap between two consecutive Board meetings was within the period prescribed under the provisions of Section 173 of the Act and SEBI Listing Regulations.

Board Committees

As on March 31, 2025, the Board had the following Committees:

(i) Audit Committee

(ii) Nomination and Remuneration Committee

(iii) Stakeholders Relationship Committee

(iv) Risk Management Committee

(v) Corporate Social Responsibility Committee

(vi) Investment Committee

The details of composition, terms of reference and number of meetings held during the year under review and the

attendance of the Committee Members at each meeting are given in the Corporate Governance Report, which forms part of this Annual Report.

Report on Corporate Governance

Corporate governance is about maximizing shareholder value legally, ethically and sustainably. Our corporate governance practices are a reflection of our value system encompassing our culture, policies, and relationships with our stakeholders. In compliance with Regulation 34 read with Schedule V of the SEBI Listing Regulations, the Report on Corporate Governance of the Company, inter alia, covering composition, details of meetings of the Board and Committees, together with a certificate from M/s. VAPN & Associates, Practicing Company Secretaries (Firm Registration No.: P2015DE045500) regarding compliance of conditions of Corporate Governance, forms part of this Annual Report.

A certificate from the Managing Director and Chief Executive Officer and the Executive Director, President and Group Chief Financial Officer of the Company in terms of Regulation 17 of the SEBI Listing Regulations, inter-alia, confirming the correctness of the financial statements and cash flow statements, adequacy of the internal control measures and reporting of matters to the Audit Committee, also forms a part of this Annual Report.

Directors' Responsibility Statement

Pursuant to clause (c) of sub-section (3) of Section 134 of the Act, it is confirmed that:

a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of FY 2024-25 and of the loss of the Company for that period;

c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities;

d) the Directors had prepared the annual accounts on a going concern basis;

e) the Directors, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Policy on Appointment and Remuneration

The Board has framed and adopted a Nomination, Remuneration and Board Diversity Policy in terms of Section 178 of the Act and Regulation 19(4) read with Part D of Schedule II to the SEBI Listing Regulations ("NR Policy"), for identification, selection and appointment of Directors, Key Managerial Personnel (KMPs) and Senior Management Personnel (SMPs) of the Company. The Policy lays down the process and parameters for the appointment and remuneration of the Directors, KMPs and other SMPs and the criteria for determining qualifications, highest level of personal and professional ethics, positive attributes, financial literacy and independence of a Director. The Policy is available on the website of the Company at https://ir.paytm.com/policies-and-guidelines.

Board Evaluation

Pursuant to the provisions of the Act and the SEBI Listing Regulations, an evaluation process was carried out to evaluate performance of the Board and its Committees, the Chairman of the Board and all Directors, including Independent Directors. The evaluation is aimed at improving the effectiveness and enhancing their contribution to the functioning of the Board. The questionnaire for this evaluation was developed, based on improvement areas identified by the Nomination and Remuneration Committee. The results of evaluation of the performance of the Board, individual directors and various Committees were subsequently discussed at their respective meetings and the areas for improvement of the functioning of the Board, individual directors and Committees were duly noted.

In a separate meeting of the Independent Directors, performance of the Non-Independent Directors, Chairman of the Board and the Board as a whole was also evaluated.

Business Responsibility and Sustainability Report

In compliance with Regulation 34 of the SEBI Listing Regulations read with SEBI Master Circular No. SEBI/ HO/CFD/PoD2/CIR/P/0155 dated November 11, 2024,

the Business Responsibility and Sustainability Report of the Company for FY 2024-25 describing the various initiatives undertaken from an environment, social and governance perspective during FY 2024-25 forms part of this Annual Report.

Management Discussion and Analysis Report

The Management Discussion and Analysis Report for FY 2024-25 on Company's performance, industry trends and other required details prepared in compliance with Regulation 34 of the SEBI Listing Regulations, forms part of this Annual Report.

Extract of Annual Return

The Annual Return of the Company as on March 31, 2025, in form MGT-7 as required under Section 92 and Section 134 of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is available on the website of the Company at https://ir.paytm.com/agm.

Internal Auditors and Internal Financial Controls

The external audit firm appointed by the Board and inhouse Internal Audit team performs defined Internal Audit functions as approved by the Audit Committee.

Internal Audit function is governed by the Internal Audit Charter and Internal Audit Manual approved by the Audit Committee. Internal Audit scope, Internal Audits / reviews along with the update on remediation status are submitted and presented in the Audit Committee meetings every quarter.

Internal Financial Control and their adequacy

The Company has laid down adequate internal financial controls commensurate with the scale and size of the operation of the Company. The Company has in place adequate policies and procedures for ensuring the orderly and effective control of its business, including adherence to the Company's policies, safeguarding its assets, prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

The Company has an adequate system of internal control commensurate with its size and nature of business. These systems provide a reasonable assurance in respect of providing financial and operational information, safeguarding of assets of the Company, adhering to the management policies besides ensuring compliance.

Prevention of Sexual Harassment at Workplace

Paytm's goal is to ensure that employees, regardless of gender, sexual orientation, or any other distinguishing factors, feel empowered to contribute to the best of their abilities. In line with this, the Prevention of Sexual Harassment ("POSH") at Workplace Policy has been framed under the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("POSH Act"), to prohibit, prevent or deter the commission of acts of sexual harassment at workplace and to provide the procedure for the redressal of complaints pertaining to sexual harassment which is hosted on the Company's website and can be accessed using the below link: https://paytm.com/document/ir/ policies-and-guidelines/POSH-Policy.pdf. The Company has also constituted an Internal Complaints Committee ("ICC") as per the requirements under the POSH Act. The ICC ensures that all cases reported are resolved in a timely manner, in accordance with the POSH Act. All the existing employees and any new joiner undergoes a mandatory training on POSH every fiscal year. The Company also ensures to organize several virtual seminars on POSH for everyone to make them cognizant of the guidelines laid in the policy.

The detailed disclosure on POSH is given in the Corporate Governance Report, which forms part of this Annual Report.

Maternity Benefit Act, 1961

The Company has complied with all applicable provisions relating to the Maternity Benefit Act, 1961 and all benefits and entitlements are duly extended to eligible employees.

Particulars of Employees

The statement containing disclosure of remuneration under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is given in Annexure III forming a part of this Report. The information as per Rule 5(2) and Rule 5(3) of the above-mentioned Rules pertaining to the names of top ten employees and other particulars of employees is provided in a separate annexure. However, as per the provisions of Section 136(1) of the Act and the Rules thereunder, the Annual Report and the financial statements, excluding the aforesaid annexure, are being sent to the Members, and other persons entitled thereto. Any Member interested in obtaining a copy of the annexure

may write to the Company Secretary and Compliance Officer at compliance.officer@paytm.com.

Risk Management

The Company maintains a robust and comprehensive Risk Management Framework designed to proactively identify and evaluate both business risks and opportunities. This framework encompasses well-defined policies and procedures aimed at fostering transparency, minimizing potential adverse impacts on our business objectives, and ultimately enhancing the Company's competitive advantage. The enterprise-wide risk management approach includes detailed documentation and reporting protocols across all levels of the organization.

The Risk Management Committee of the Board of Directors, chaired by an Independent Director, provides crucial governance by periodically reviewing the implementation of Risk Management Framework, regular monitoring of risk assessments and mitigation strategies, covering the essential stages of risk identification, quantification, and evaluation.

Further details regarding our Enterprise Risk Management Policy are available on the Company's website at https:// ir.paytm.com/policies-and-guidelines.

Vigil Mechanism/ Whistle Blower Policy

The Company has adopted a Whistle Blower Policy / Vigil Mechanism with protective clauses for the whistleblowers to report genuine concerns, in confirmation with the provisions of Section 177(9) of the Act and Regulation 22 of SEBI Listing Regulations. The Policy provides adequate safeguards against victimization of whistleblowers and provides direct access to the Chairperson of the Audit Committee, in exceptional circumstances.

The policy provides for a mechanism to report concerns about unethical behaviour, actual or suspected fraud, instances of leak of Unpublished Price Sensitive Information or violations of your Company's Code of Conduct. The detailed disclosure is given in the Corporate Governance Report, which forms part of this Annual Report.

The policy is available on the website of the Company at https://ir.paytm.com/policies-and-guidelines.

Foreign Exchange Earnings and Outgo

The Foreign Exchange earnings and outgo by the Company during FY 2024-25, under review are as follows:

Statutory Auditors

M/s. S.R. Batliboi & Associates LLP, Chartered Accountants (Firm Registration No.: 101049W/E300004), were appointed as the Statutory Auditors of the Company at the AGM held on September 12, 2023, for a term of 5 (five) consecutive years from the conclusion of 23^rd AGM till the conclusion of 28^th AGM of the Company.

The Report given by the Statutory Auditors on the Standalone Financial Statements of the Company and the Consolidated Financial Statements of the Company for the financial year ended March 31, 2025, forms part of this Annual Report. There has been no qualification, reservation, adverse remarks or disclaimer given by the Statutory Auditors in their Report which calls for any explanation.

Secretarial Auditors

M/s. VAPN & Associates, firm of Practicing Company Secretaries (Firm Registration No.: P2015DE045500), carried out the Secretarial Audit for FY 2024-25 in compliance with the Act and the Rules made thereunder, the SEBI Listing Regulations. The Secretarial Auditors' Report is enclosed as Annexure IV to this report.

In compliance with Regulation 24A of the SEBI Listing Regulations, the Secretarial Audit Report of PPSL, a material subsidiary of the Company for FY 2024-25 issued by M/s. VAPN & Associates, Practicing Company Secretaries is enclosed as Annexure V to this report.

The Secretarial Audit Report of the Company and its unlisted material subsidiary does not contain any qualification, reservation, adverse remark or disclaimer.

In compliance with Regulation 24A of the SEBI Listing Regulations and Section 204 of the Act, the Board at its meeting held on July 22, 2025, has approved the appointment of M/s Chandrasekaran Associates, Company Secretaries (Firm Registration No.: P1988DE002500) as the Secretarial Auditors of the Company for a period of Five years commencing from FY 2025-26 till FY 2029-30, subject to approval of the Members in ensuing Annual General Meeting.

Energy Conservation:

We are committed to adopting best practices for energy conservation across all major offices. The key initiatives include:

• Use of LED fixtures to reduce electricity consumption;

• Deployment of energy-efficient appliances across office spaces; and

• Installation of sensor-based water faucets and lighting systems in washrooms to minimize wastage.

The Corporate Office- Skymark One in Noida, having a large employee base, has been certified Platinum rated by the Indian Green Building Council (IGBC). Our selection and presence in this building is testimony of our commitment towards sustainable development. Key features considered by us, while selecting this building includes:

• Sustainable site planning;

• Enhanced water and energy efficiency;

• Reduced waste generation and carbon emissions;

• Use of eco-friendly building materials; and

• Improved indoor environmental quality.

Additionally we have been incorporating energy-saving infrastructure namely :

• Use of Energy-efficient design elements such as LED lighting, energy-efficient windows and insulation, geothermal heat pumps, and high- efficiency appliances;

• Installation of Variable Refrigerant Volume/Variable Refrigerant Flow (VRV/VRF) systems (2^nd generation energy-efficient models ) across most facilities;

• Deployment of Variable Air Volume (VAV) controllers in meeting rooms and open office floors, enabling cooling based on occupancy and thereby reducing overall load on AHUs and chillers;

• Use of heat-resistant fagade glass throughout buildings to minimize thermal gain, maintain comfortable indoor temperatures, and enable abundant natural lighting;

• New procurement of appliances are 5-star rated, ensuring maximum energy efficiency; and

• Implemented a Building Management System (BMS) at Skymark Noida to monitor and control energy consumption. This allows real-time optimization and further improvements in energy efficiency.

Technology Absorption

Paytm operates not only as a leading payments platform but also as a technology-driven Company, building the digital infrastructure that underpins India's fintech ecosystem. Our technology-first approach is powered by a team of over 2,000 engineers who leverage cutting- edge advancements in Artificial Intelligence (AI), Machine Learning (ML), Internet of Things (IoT), big data, and real-time analytics. This robust technological foundation enables us to deliver scalable, secure, and intelligent financial solutions to millions of consumers and merchants, reinforcing our leadership position in India's rapidly evolving digital economy.

This year, we reinforced our commitment to innovation through several pioneering initiatives. We introduced solar- powered Soundboxes specifically designed for mobile merchants such as vegetable vendors, solving the critical challenge of device charging while on the move. Building on this, we launched the Dual-Battery Soundbox to provide even greater reliability for high-transaction merchants. In another industry-first innovation, we enabled merchants and users to add a QR code directly to their phone's home screen, eliminating the need to open the app for payments. Our UPI offerings were significantly enhanced with the launch of UPI International and UPI Lite auto top-up features, delivering a more seamless payment experience to users.

Our subsidiary, Paytm Money, continued its trajectory of innovation by simplifying onboarding flows, introducing BSE F&O trading, and launching Margin Trading Funding (MTF). A notable advancement was the implementation of UPI Trading Blocks, which allows customers to reserve funds in their bank accounts without pre-funding trading wallets, creating greater flexibility for retail investors.

Paytm has strategically positioned Artificial Intelligence (AI) at the core of its operational framework and product innovation to drive efficiency, enhance customer experience, and unlock incremental revenue opportunities across its ecosystem. As an early and aggressive adopter, the Company leverages state-of-the-art AI tools and AI-first platforms like Paytm ARMS (merchant lifecycle insights) and Periscope (fraud and risk detection system) to gain deep contextual data insights, automating processes from merchant onboarding and segmentation to pricing optimization and personalized retention capabilities. This AI-led approach has significantly streamlined operations, optimizing approval rates and pricing decisions, while also enabling a proprietary, real-time fraud and risk detection engine for proactive transactional integrity. Furthermore, AI powers 24/7 conversational AI agents to provide highly personalized, multi-lingual assistance for merchant and consumer queries, significantly improving customer

2025

delight. Critically, AI underpins the Company's enhanced cross-sell capabilities by identifying high-transacting merchant prospects and improving marketing efficiency through sharper audience segmentation and targeting, which reduces customer acquisition costs and improves ROI. Advanced AI models also predict merchant churn and delinquency with high precision, enabling timely, segment- specific interventions that lead to improved asset quality for partners and increased collection bonuses. Internally, the continued leverage of AI for improving productivity across businesses has contributed to a notable decline in non-sales employee costs. This comprehensive integration of AI across merchant payments, distribution of financial services, and consumer offerings, including features like AI Smart Filters for travel ticketing and AI-led Portfolio Analyzers for investments, solidifies Paytm's competitive moat and fuels scalable monetization and growth.

Looking ahead, we remain focused on strengthening our platform capabilities to drive sustainable growth. Our priorities include deeper integration of AI/ML across our operations, continued development of merchantcentric solutions to expand financial inclusion, and further enhancements to our infrastructure to support scaling. These strategic initiatives underscore our commitment to maintaining technology leadership while creating long-term value for all stakeholders in India's digital financial ecosystem.

Awards and Recognitions

During FY 2024-25, the Company received multiple awards and recognitions. Details in respect of such awards and recognitions received by the Company are available on the website of the Company at https://ir.paytm.com/awards.

Secretarial Standards

The Company complies with all applicable secretarial standards issued by the Institute of Company Secretaries of India in terms of Section 118(10) of the Act.

Other Statutory Disclosures

No disclosure or reporting is made with respect to the following items, as there were no transactions during FY 2024-25:

• The issue of equity shares with differential rights as to dividend, voting or otherwise;

• Issue of equity shares (including sweat equity shares) to employees of the Company under any scheme except Employees' Stock Options Schemes referred to in this Report;

• In terms of the provisions of Section 73 of the Act read with the relevant Rules of the Act, the Company had no opening or closing balances and also has not accepted any deposits during the financial year under review and as such, no amount of principal or interest was outstanding as on March 31, 2025;

• There were no fraud under Section 143 (12) of the Act reported by the Auditors to the Audit Committee or the Board or Central Government;

• The Company did not have any scheme or provision of money for the purchase of its own shares by employees or by trustees for the benefits of employees;

• There were no proceeding pending under the Insolvency and Bankruptcy Code, 2016;

• There was no instance of one-time settlement with any Bank or Financial Institution;

• Executive Directors of the Company have not received any remuneration or commission from any of its subsidiaries;

• There were no revision in the financial statements;

• There are no significant or material orders passed by the regulators or courts or tribunals which impact the going concern status of the Company and its operations in future;

• The Company is not required to maintain cost records under Section 148 of the Act;

• The Company has not made any downstream investments during the year under review and a certificate from Statutory Auditors has been obtained in this regard;

• There was no instance wherein the Company failed to implement any corporate action within the statutory time limit; and

• The Company has not made any political party contribution under section 182 of the Act.

Cautionary Statement

Statements in this Annual Report describing the Company's objectives, expectations or predictions may be forwardlooking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement.

Acknowledgement

The Board is grateful for the continued support provided by our valued customers, investors, government, regulatory authorities and other stakeholders. The Board appreciates the hard work and exemplary dedication of the employees of our Company for showing remarkable teamwork during FY 2024-25.