PAYTM FOUNDER Vijay Shekhar Sharma, a Bollywood buff, finds himself confronting the kind of existential crisis often found in cinema.
This is because the Reserve Bank of India (RBI) has asked the group’s Paytm Payments Bank (PPBL) to halt most of its activities—like taking more deposits, conducting credit transactions, and allowing customers to top up their accounts—after February 29 due to persistent noncompliance.
One97 Communications (OCL), the parent company of Paytm, owns 49% equity in PPBL, with Sharma, the majority owner, holding the rest. RBI allows payments banks, under its differentiated licensing scheme, to accept current and savings deposits and offer payments products, but no lending is permitted.
Besides, both entities, OCL and PPBL, share close business linkages. The parent company’s Paytm app offers various payments instruments from Paytm Payments Bank, such as Wallet, Paytm UPI, FASTag, and fixed deposits.
As RBI Governor Shaktikanta Das pointed out after the recent meeting of the central bank’s monetary policy committee, lapses associated with Paytm had been pointed out multiple times. He said when constructive engagement doesn’t work or when the regulated entity does not take effective action, RBI imposes business restrictions. “Paytm should have corrected these issues two years ago, when RBI directed PPBL to stop onboarding new customers and appoint an IT audit firm to conduct a comprehensive system audit of its IT systems,” says a banker.
This story is from the March 03, 2024 edition of Business Today India.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the March 03, 2024 edition of Business Today India.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber? Sign In
The Dark Side Of Gold Loans
There Has Been A Sharp Rise In Gold Loans In Recent Years. But There Is A Seedier Side To This, As Is Evident From The Red Flag The RBI Raised Recently. Will The Regulator's Move Protect Customers?
All That Glitters
The price of gold has been rising unabated. It has soared to more than 73,000 per 10 gm in 2024 from *31,000 in early 2018. Is the rally sustainable or is this a bubble?
"Hire for attitude, not ability"
Thryve Digital is a player in the healthcare technology sector delivering next-generation solutions
Road Warrior
For Khalid Wani, Senior Director of Sales at Western Digital India, life is much more than just the corner office. Biking across the world is one way he derives meaning for his life
WIDENING THE POOL
THERE HAS BEEN A JUMP IN INDIVIDUALS INVESTING DIRECTLY IN THE STOCK MARKETS, BUT MUMBAI AND AHMEDABAD STILL ACCOUNT FOR THE LION'S SHARE. THERE DEFINITELY IS SCOPE FOR IMPROVEMENT IN TERMS OF PENETRATION LEVELS ACROSS THE COUNTRY
CRISIS IN THE CLOUDS
INDIAN AVIATION IS IN CRISIS. AIRLINES ARE GRAPPLING WITH FLIGHT CANCELLATIONS, CREW SHORTAGES, AND COMPLAINTS ABOUT POOR SERVICE, ARE BLEEDING DUE TO RISING COSTS WILL THE FASTEST-GROWING AVIATION MARKET RECOVER?
"India should start privatising public sector banks"
Arvind Panagariya, Chairman of the 16th Finance Commission, on growth, inequality, jobs, the banking sector, and more
"I LET MY WORK DO THE TALKING"
Megha Engineering & Infrastructures MD P.V. Krishna Reddy on being low profile, the infra opportunity and much more
"Core of insurance lies in long-term security"
Vibha Padalkar, MD & CEO of HDFC Life, on the insurance provider's performance, surrender charges, and future innovations
Distress in the Books
Bandhan Bank, the brainchild of Chandra Shekhar Ghosh, has made the journey from an MFI to a bank, but with many hurdles. Now with his resignation as MD & CEO, is the lender staring at more uncertainty?