Only Paytm Payments Bank Affected By RBI Directive, Not App: Founder

The founder of India's pioneering online and QR payments app, Vijay Shekhar Sharma took to X to appeal to users that the app will continue to function and the RBI's directive only affects the Paytm Payments Bank.
The Paytm app will continue to function beyond Feb 29 asserted founder Vijay Shekhar Sharma
The Paytm app will continue to function beyond Feb 29 asserted founder Vijay Shekhar Sharma

Paytm, the trailblazer of QR and mobile payments in India, has stated that its application is operational and will remain so beyond February 29. The company clarified that the Reserve Bank of India's (RBI) directive will impact only its associate bank and not the fintech company.

Vijay Shekhar Sharma, the founder and CEO of Paytm, recently shared his thoughts on the operations of the Paytm app and expressed gratitude for the company's received support.

Taking to X, Sharma posted, "To every Paytmer, Your favourite app is working, will keep working beyond 29 February as usual. I, with every Paytm team member, salute you for your relentless support. For every challenge, there is a solution and we are sincerely committed to serve our nation in full compliance. India will keep winning global accolades in payment innovation and inclusion in financial services - with PaytmKaro as the biggest champion of it."

Earlier in the day, Madhur Deora, President and Group CFO of Paytm, also made it clear that Paytm and its affiliated bank are not and cannot be the same entity.

"There may be this impression that Paytm and Paytm Payment Bank is one, but by design and by structure, it is not and it cannot be. First it is an associate company and second is not an associate company in the sense that is some Bank. And first and foremost for a bank is that, it has to follow the governance that a bank is supposed to follow, which is to say that has to has its independent management team, which reports to the board and the matters that have to go to committees of the board where can only be independent directors," he elaborated during an address to analysts.

Paytm, a payments firm, collaborates with multiple banks (beyond just Paytm Payments Bank) on diverse payment offerings. Over the last two years, the company has partnered with other banks and intends to expedite its plans to fully transition to other bank partners.

The company's next step is to further grow its payments and financial services operations, exclusively through collaborations with other banks.

The financial technology company mentioned in a regulatory filing that its affiliated bank operates autonomously under the supervision of its own management and board.

"We would take this opportunity to clarify that as per banking regulations, Paytm Payments Bank Limited is run independently by its management and board. While OCL is allowed to have two board seats on the board of Paytm Payments Bank Limited, as a part of its shareholder agreement, OCL exerts no influence on the operations of Paytm Payments Bank Limited, other than as a minority board member, and minority shareholder," the company said in a statement.

The Paytm app will continue to function beyond Feb 29 asserted founder Vijay Shekhar Sharma
RBI Directs Paytm Payments Bank to Halt New Customer Onboarding

Related Stories

No stories found.

No stories found.
Pratidin Time