Vijay Shekhar Sharma, the founder of Paytm, has announced his resignation as the non-executive chairman and board member of Paytm Payments Bank Ltd (PPBL). This decision comes as the company faces regulatory challenges from the Reserve Bank of India.
The RBI has directed PPBL to halt further deposits, credit transactions, or top-ups in any customer accounts, prepaid instruments, wallets, FASTags, and National Common Mobility Cards by March 15 due to non-compliance with certain norms. This move has prompted Sharma’s resignation from his position within the payments bank.
Additionally, the RBI has requested the National Payments Corporation of India (NPCI) to review Paytm’s request to become a third-party application provider. Paytm is looking to collaborate with four to five banks to process transactions via the popular Unified Payments Interface (UPI).
According to sources familiar with the matter, Paytm is in talks to partner with Axis Bank, HDFC Bank, State Bank of India, and Yes Bank for processing UPI transactions. The company aims to begin this process with larger banks that possess the necessary technological capabilities to manage substantial transaction volumes seamlessly.
Paytm, known as India’s third-largest app for UPI payments, is navigating these regulatory hurdles amidst its efforts to establish partnerships with key banking entities.
