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Paytm Payments Bank Chairman, Vijay Shekhar Sharma, Steps Down

  • Posted on February 26, 2024
  • Business
  • By TSW NEWS DESK
  • 121 Views

Vijay Shekhar Sharma has resigned as chairman of Paytm Payments Bank amidst regulatory concerns raised by the RBI. The move comes after the RBI directed NPCI to scrutinize Paytm's UPI channel. Paytm Payments Bank has been barred from certain transactions due to non-compliance highlighted in audits.

Paytm Payments Bank Chairman, Vijay Shekhar Sharma, Steps Down Image Source -www.gujaratsamachar.com

Amidst regulatory scrutiny and strategic adjustments, Vijay Shekhar Sharma has opted to resign from his position as chairman of Paytm Payments Bank. This significant decision follows a recent restructuring of the bank's board, signaling a pivotal moment for the organization. One 97 Communications Ltd (OCL), the parent company of Paytm, officially confirmed Sharma's departure from the role of part-time non-executive chairman and board member. This move is part of a broader effort to navigate regulatory challenges and ensure compliance with industry standards.

The catalyst for Sharma's resignation stems from regulatory interventions initiated by the Reserve Bank of India (RBI). The RBI directed the National Payments Corporation of India (NPCI) to conduct a thorough examination of Paytm's use of the Unified Payments Interface (UPI) channel. This scrutiny is aimed at assessing Paytm's adherence to regulatory guidelines and facilitating the smooth transition of @paytm handles to multiple banks. The regulatory directive underscores the importance of ensuring transparency and accountability in digital payment ecosystems.

The regulatory scrutiny on Paytm Payments Bank intensified following the RBI's recent actions. Last month, the RBI imposed restrictions on PPBL, prohibiting the bank from accepting additional deposits or conducting credit transactions. Exceptions were made only for specific scenarios, such as interest payments, cashbacks, or refunds. These restrictions were imposed in response to audits that revealed persistent non-compliance issues and significant supervisory concerns within the bank's operations. The RBI's actions underscore the importance of regulatory oversight in maintaining the stability and integrity of financial institutions.

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As part of the regulatory measures, the RBI has mandated the termination of nodal accounts associated with One97 Communications Ltd and Paytm Payments Services Ltd. This directive aims to streamline operations and ensure compliance with regulatory standards. The termination of these accounts represents a proactive step towards addressing regulatory concerns and fostering a culture of compliance within the organization.

Overall, Vijay Shekhar Sharma's decision to step down as chairman of Paytm Payments Bank reflects the organization's commitment to addressing regulatory challenges and upholding the highest standards of corporate governance. The restructuring of the board and the implementation of regulatory directives demonstrate Paytm's proactive approach to navigating the evolving regulatory landscape in the financial sector.

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