Vijay Shekhar Sharma, the CEO of Paytm, met Finance Minister Nirmala Sitharaman on February 6, studies counsel citing sources. This comes days after the RBI ordered its fee financial institution to halt enterprise, resulting in a share value rout.
Earlier within the day, information company Reuters additionally reported that Sharma and some Paytm officers had met the RBI on Monday to debate regulatory issues.
Also Read: Here’s Why RBI Banned Paytm Payments Bank
The conferences come after the RBI requested Paytm Payments Bank final Wednesday to cease accepting new deposits in its accounts and its standard digital wallets from March, citing supervisory issues and non-compliance with guidelines.
“Discussions are on about addressing the regulatory concerns and compliance issues with both the RBI and the ministry,” one of many sources advised Reuters.
Paytm Seeks Extension
The firm has sought an extension of the Feb. 29 deadline from the RBI and has additionally been looking for readability from the central financial institution concerning the switch of its licence for the wallets enterprise and digital freeway toll fee service Fastag, the supply stated.
“The RBI heard Paytm out without making any commitments,” a second supply stated.
Paytm Shares
As of Monday, Paytm’s shares had fallen about 42%, wiping $2.5 billion off its market worth on issues in regards to the impression on the broader enterprise, as Paytm Payments Bank powers most options of the digital funds app, which competes with the likes of Walmart’s PhonePe and Google.
The inventory hit a report low early on Tuesday following a Reuters report that India’s federal anti-fraud company was investigating if platforms run by the corporate have been concerned in violations of overseas trade guidelines.
A Paytm spokesperson denied any violations of overseas trade regulation, calling the allegations ”unfounded and factually incorrect”.
The RBI’s regulatory clampdown may be a precursor to Paytm’s licence being cancelled, a supply aware of the matter stated final week.
Paytm’s shares reversed some losses on Tuesday to shut 2.9% greater at 451.15 rupees, after rising as a lot as 8% earlier within the day.
Wait and Watch
HDFC Bank is “talking” to its longstanding accomplice Paytm because the fintech tries to discover a means out of the present restrictions positioned by RBI, a senior government on the largest non-public sector lender stated on Tuesday.
Stressing that the financial institution would have been conversing with the fintech even in any other case given its partnership within the acceptance and aggregator area, HDFC Bank’s nation head for funds Parag Rao stated it’s in a “wait and watch” mode.
Rao made it clear that HDFC Bank’s partnership with Paytm is with the guardian entity One97 Communications, and never with the Paytm Payments Bank, which is underneath regulatory scrutiny.
(With Reuters inputs)
