Paytm Payments Bank’s Chairman Vijay Shekhar Sharma Resigned

Vijay Shekhar Sharma, the founder of Paytm, has stepped down from the post of Part-time Non-executive Chairman of Paytm Payments Bank Limited (PPBL) before the March 15 deadline for shutting down its operations.

PPBL has also reshaped its Board of Directors, appointing former Chairman of the Central Bank of India, Srinivasan Sridhar, retired IAS officer Debendranath Sarangi, former Executive Director of the Bank of Baroda Ashok Kumar Garg, and former IAS officer Rajni Sekhri Sibal, as stated in a regulatory filing by One 97 Communications Limited on February 26.

According to the filing, it has been communicated to the company that Sharma has resigned from the Board of Paytm Payments Bank as part of the transition process. PPBL has stated its intention to initiate the appointment of a new Chairman.

This decision comes in the context of the Reserve Bank of India’s (RBI) strict measures against the payments bank due to persistent non-compliance and supervisory concerns.

The RBI instructed Paytm Payments Bank to stop banking operations after February 29, subsequently extending the deadline till March 15.

RBI mentioned that based on the comprehensive system audit report and subsequent compliance validation report by external auditors, ongoing non-compliance issues and significant supervisory concerns persisted in the bank, necessitating further regulatory action.

The bank is prohibited from accepting new deposits, conducting credit transactions, or facilitating top-ups on customer accounts, prepaid instruments, wallets, or cards for road toll payments. However, interest, cashbacks, or refunds can still be processed, according to the RBI.

Media reports suggest that Paytm is likely to collaborate with Axis Bank, HDFC Bank, the State Bank of India, and Yes Bank to process transactions via the popular Unified Payments Interface (UPI).