Finance Minister Nirmala Sitharaman is set to convene a meeting with top executives of fintech firms next week, amid ongoing issues surrounding Paytm. Speculation suggests the meeting aims to underscore the importance of adhering strictly to regulatory guidelines.
Last month, Paytm Payments Bank Ltd, affiliated with One97 Communications Ltd, faced regulatory repercussions from the Reserve Bank due to non-compliance with various norms, including Know Your Customer (KYC) guidelines.
The Finance Minister is expected to stress the significance of KYC norms and regulatory compliance without taking sides.
Earlier this month, Paytm’s CEO and senior officials met with the Finance Minister and RBI senior officials. Reserve Bank Governor Shaktikanta Das, in a media briefing, reiterated the central bank’s support for the fintech sector and its commitment to its growth.
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The RBI recently advised customers and merchants of Paytm Payments Bank Ltd (PPBL) to transfer their accounts to other banks by March 15, extending the initial deadline of February 29, 2024. This extension was granted considering the interests of PPBL’s customers and merchants who may require more time to make alternative arrangements in the broader public interest.
Additionally, the RBI ordered the closure of the ‘nodal accounts’ of One97 Communications Ltd, the parent company of the Paytm brand. One97 Communications, which holds a 49% stake in PPBL, views it as an associate company rather than a subsidiary.