On Monday, Paytm, a prominent financial services company, refuted reports suggesting ongoing discussions with potential investors for the sale of its wallet business. This comes in the backdrop of the Reserve Bank of India (RBI) imposing a ban on Paytm Payments Bank. Contrary to speculations naming HDFC Bank and Jio Financial Services as potential buyers, a Paytm Payments Bank spokesperson, in a statement to IANS, asserted that the company does not comment on market speculations. The spokesperson emphasized their commitment to regulatory compliance and ensuring a seamless customer experience with the products offered by Paytm Payments Bank Ltd (PPBL).
Paytm Founder and CEO, Vijay Shekhar Sharma, reassured the company's staff that there would be no job cuts, and discussions with the RBI were ongoing, exploring potential partnerships with other banks. During a virtual town hall, Sharma expressed confidence in resolving the situation soon and reaching out to the RBI for guidance.
Amidst these developments, Paytm's shares on the BSE were subjected to a lower circuit of 10 percent, trading at Rs 438.35.
Clarifying the relationship between Paytm and its associate bank, Madhur Deora, President and Group CFO at Paytm, highlighted that, both by design and structure, the fintech company and its associate are distinct entities. Despite the impression that they are intertwined, Deora emphasized that Paytm Payments Bank is an associate company, not a standalone bank. He underscored the necessity for the bank to adhere to governance standards, with an independent management team reporting to the board. Furthermore, he highlighted the essential elements of a bank, including independent compliance and risk teams.
(With Agency Inputs)