Bengaluru: Paytm parent One97 Communications reported its first full year of profitability since listing, even as the fintech company continued to deal with the fallout of regulatory action on Paytm Payments Bank and pivoted further towards merchant payments, lending distribution and artificial intelligence-led automation.The company reported total income of Rs 9,291 crore for FY26, up 21.8% from Rs 7,625 crore a year earlier, according to its exchange filing. Profit for the year stood at Rs 552 crore compared with a loss of Rs 663 crore in FY25.For the March quarter, total income rose 14.4% year-on-year to Rs 2,442 crore from Rs 2,135 crore a year earlier. Quarterly profit came in at Rs 183 crore against a loss of Rs 545 crore in the corresponding period last year.The results come shortly after the Reserve Bank of India cancelled the banking licence of Paytm Payments Bank Ltd (PPBL), intensifying regulatory scrutiny around the fintech group after earlier restrictions on deposits and onboarding of customers. In its earnings release, Paytm said there had been “no financial or business impact” from the cancellation and noted that its investment in PPBL had already been fully impaired as of March 2024.Over the past year, the company has increasingly repositioned itself around payments processing, merchant subscriptions and distribution of financial products such as loans and wealth offerings.Revenue from distribution of financial services rose 52% year-on-year to Rs 2,594 crore in FY26, while merchant gross merchandise value increased 27% year-on-year to Rs 6.5 lakh crore in the March quarter.The company also highlighted wider deployment of artificial intelligence across engineering, fraud detection, merchant onboarding and collections. Paytm said it is using AI-assisted coding, testing and deployment systems internally to improve operating leverage and reduce software development costs.Consumer UPI gross transaction value grew 46% year-on-year in the March quarter, while monthly transacting users rose to 7.7 crore.Paytm ended FY26 with a cash balance of Rs 13,315 crore.