Shares of One97 Communications, the parent of Paytm, on Wednesday surged 6.50 per cent after the National Payments Corporation of India (NPCI) granted approval to Paytm to onboard new UPI users, subject to the adherence to all procedural guidelines and circulars.

The stock jumped 6.34 per cent to Rs 730.90 on the BSE.

At the NSE, it soared 6.51 per cent to Rs 731.15.

The NPCI nod is expected to come as a relief to Paytm, which had suffered a blow following the Reserve Bank of India's restrictions earlier this year on associate company Paytm Payments Bank Limited (PPBL) in onboarding new UPI users on the Paytm app.

In March, the NPCI gave approval to Paytm to participate in UPI as a Third-Party Application Provider (TPAP). The NPCI allowed the company to continue UPI transactions through four banks -- SBI, Axis Bank, HDFC Bank and YES Bank.

In a late evening filing on Tuesday, Paytm informed the BSE that it has received approval from the NPCI to onboard new UPI users.

"...We would like to inform you that vide letter dated October 22, 2024, the National Payments Corporation of India (NPCI) has granted approval to the company to onboard new UPI users, with adherence to all NPCI procedural guidelines and circulars," the Paytm filing, which also attached the NPCI letter granting the nod, said.

According to the letter, the approval is subject to adherence to all NPCI procedural guidelines and circulars issued from time to time, including guidelines and circulars issued specifically on risk management, brand guidelines for app and QR, multi-bank guidelines, TPAP market share and customer data.

The company will also need to adhere to the requirements outlined in the tri-partite agreement with NPCI and PSP Banks.

One97 Communications is the parent company of fintech firm Paytm.