The crisis for the fintech giant Paytm mounted as the markets regulator gave an administrative warning to the digital payments company for certain transactions with its banking unit in the fiscal year 2021-22.
Paytm representation Image (Photo:IANS)
The crisis for the fintech giant Paytm mounted as the markets regulator gave an administrative warning to the digital payments company for certain transactions with its banking unit in the fiscal year 2021-22.
The Securities and Exchange board of India (Sebi), in a letter dated July 15, said some transactions between Paytm and the now wound-down Paytm Payments Bank were conducted without approval from the company’s audit committee or its shareholders.
As per the information shared by Paytm in an exchange filing, the administrative warning was related to two transactions with an unapproved amount of Rs 324 crore (USD38.8 million) and Rs 36 crore each.
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The Sebi in its letter said the violations were viewed “very seriously” and directed Paytm to place the letter before its board for corrective measures and submit a report on action taken within 10 days after that.
Paytm, in its response, said it believes it has consistently acted in compliance with regulation, and added that there is no impact on financials and operations of the company due to the warning.
Last month, the parent company of Paytm, One97 Communications, had said it is laying off an undisclosed number of employees and claimed that it is providing outplacement support for their smooth transition.
“One97 Communications Limited (OCL) is providing outplacement support to employees which have resigned as a part of the restructuring efforts by the company,” the company had said in a statement.
Paytm’s sales employee headcount in March 2024 quarter dropped by about 3,500 to 36,521 personnel on a quarter-on-quarter basis, mainly due the impact of the Reserve Bank of India’s ban on services of Paytm Payments Bank.
In January, the Reserve Bank of India (RBI) had barred Paytm Payments Bank Limited (PPBL), from accepting deposits, credit transactions or top-ups in any customer accounts, wallets, and FASTags, keeping in view the interest of customers, including merchants from March 15 onwards.
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