Updated February 10th, 2024 at 13:37 IST
Paytm forms advisory committee under former Sebi chairman N Damodaran
This move comes hot on the heels of stern directives from the Reserve Bank of India, highlighting repeated non-compliance with rules.
Paytm saga: Beleaguered digital payments giant Paytm has now set up an advisory committee, spearheaded by former chairman of the Securities and Exchanges Board of India (Sebi), N Damodaran, to guide Paytm Payments Bank Ltd on compliance and regulation matters. This move comes hot on the heels of stern directives from the Reserve Bank of India (RBI), highlighting repeated non-compliance with rules.
The newly constituted committee, led by N Damodaran, includes esteemed members such as MM Chitale, former president of the Institute of Chartered Accountants of India (ICAI), and banker R. Ramachandran, former Chairman and Managing Director of Andhra Bank. Their collective expertise will be instrumental in bolstering compliance frameworks and ensuring adherence to regulatory standards within the Paytm ecosystem.
The RBI's recent crackdown on Paytm Payments Bank underscored significant lapses in compliance, particularly in know-your-customer (KYC) norms and anti-money laundering regulations. Instances of single PANs linked to numerous accounts and a proliferation of dormant accounts raised serious concerns about the bank's operations. The stringent directives imposed by the RBI necessitated immediate action from Paytm to address these systemic issues.
While underscoring the regulator's commitment to safeguarding consumer interests and financial stability, RBI Governor Shaktikanta Das reiterated the imperative for regulated entities to adhere to compliance mandates diligently.
Financial turmoil and market reaction
The regulatory clampdown triggered a cascade of financial repercussions, reflected in Paytm's stock performance. The company witnessed a 44 per cent decline in share prices after the RBI's report on January 31.
Published February 10th, 2024 at 13:37 IST