After fintech company Paytm’s banking unit’s operations were slowed, Reserve Bank of India Governor Shaktikanta Das said there was “hardly any room for revision”.
Speaking to reporters in Delhi on Monday, Das said there was “barely any room” to review the action taken against Paytm Payments Bank.
Das said RBI takes action against regulated entities only after a comprehensive assessment. He reiterated that the central bank will issue a set of Frequently Asked Questions (FAQs) on the Paytm issue this week.
Addressing the issue during the February result announcement, the central bank said it took the actions due to persistent non-compliance by Vijay Shekhar Sharma’s fintech company.
Paytm Payments Bank is the regulated banking entity that accepts the deposits for the Paytm users to then make transactions on the app. The real-time payment interface of the Patym app is under the RBI regulations.
The RBI has banned Paytm users from depositing any money in Paytm Payments Bank after February 29. The banking regulator is considering removing the bank’s license as early as March, Bloomberg news agency reported earlier.
When constructive engagement does not work or when the regulated entity does not take effective action, we move to impose trade restrictions. Actions are proportionate to the gravity of the situation.Das February 8th
SoftBank Group Corp.-backed Paytm has been under regulatory scrutiny for an extended period, receiving multiple warnings over the past two years regarding questionable transactions between its banking subsidiary and its widely used payments app. “Our emphasis is always on bilateral engagement. with the regulated entities with a focus on pushing them for corrective action,” Governor Das said during the MPC result announcement. “And sufficient time is given to take such corrective action. When such constructive engagement doesn’t work or when the regulated entity doesn’t take effective action, we move to impose control or trade restrictions.”
Without specifying the nature of the measures, RBI Deputy Governor Swaminathan J said “appropriate steps” will be taken to ensure that customer inconvenience, if any, is minimised.
In order to strengthen the confidence of investors, the company last week announced the establishment of a committee to accelerate compliance. The advisory committee will be headed by former Securities Exchange Board of India (SEBI) chief Meleveetil Damodaran, Paytm parent One97 Communications Ltd said. on file Friday. The three-member committee features the former head of a prominent chartered accountant and the former president of a state-owned bank.
Earlier on Monday, the company confirmed that its Independent Director Manju Agrawal had left the company on February 1.
(tagsTo Translate)Paytm news