One 97 Communications Ltd, the parent company of Paytm, and Paytm Payments Bank Limited (PPBL), made an announcement on Friday regarding the discontinuation of several inter-company agreements as the Reserve Bank of India (RBI) deadline for the bank’s operations draws near.
In a filing with the Bombay Stock Exchange (BSE), the company stated that Paytm and PPBL have decided to terminate various inter-company agreements with Paytm and its group entities as part of an effort to reduce dependencies. Additionally, the shareholders of PPBL have agreed to simplify the Shareholders Agreement (SHA) to enhance PPBL’s governance independently of its shareholders.
The decision to terminate agreements and amend the SHA was approved by the One 97 Communications Ltd (OCL) Board on March 1, 2024, according to the filing.
Earlier, the company had announced plans to forge new partnerships with other banks and implement measures to ensure seamless services for its customers and merchants. It had also provided an indication of the possible financial impact in its communication to stock exchanges on February 1, 2024.
Despite the RBI’s deadline of March 15, services such as the Paytm app, Paytm QR, Paytm soundbox, and Paytm Card machines will continue to operate without interruption. Paytm reaffirmed its commitment to maintaining the highest standards of market-leading innovation and technology-enabled solutions for its customers.
In late February, Vijay Shekhar Sharma, Founder and CEO of Paytm, stepped down as Non-Executive Chairman and Board Member of Paytm Payments Bank. PPBL's future business direction will be guided by a reconstituted Board led by OCL following the RBI's ban on the bank's operations from March 15.
Read also | February Sees Surge in India's Manufacturing Sector Amid Strong Demand
