In a swift encounter between Paytm CEO Vijay Shekhar Sharma and Finance Minister Nirmala Sitharaman, crucial advice was shared regarding the recent RBI restrictions. As Paytm grapples with the aftermath of the Reserve Bank of India’s clampdown on its digital wallet, deposits, and credit products, government sources reveal a brief, yet impactful, 10-minute meeting.
No Intervention in RBI Matter
During the meeting, Finance Minister Nirmala Sitharaman made it clear that the government has no role to play in the ongoing tussle between Paytm and the RBI. In the wake of the RBI’s directive instructing Paytm to cease specific financial services, including deposits and credit transactions, Paytm sought government intervention, only to be redirected to resolve the matter directly with the regulatory authority.
Last week, the RBI imposed stringent restrictions on Paytm Payments Bank Ltd, barring it from accepting deposits or facilitating credit transactions, including top-ups, after February 29. The regulatory measures also extended to terminating the nodal accounts of Paytm’s parent company, One97 Communications Ltd, intensifying the challenges for the digital payments giant.
Meeting with FM and RBI Officials
Vijay Shekhar Sharma’s efforts to address the regulatory concerns extended beyond the brief meeting with the Finance Minister. He also engaged in discussions with RBI officials to delve into the intricacies of the restrictions and explore potential resolutions. The dual engagement underscores the urgency and complexity of resolving the issues raised by the RBI.
Reassurances Amid Share Slump
As Paytm’s shares witnessed a significant dip of over 40%, Vijay Shekhar Sharma assures users that their money is secure. Despite restrictions on deposits and credit transactions after February 29, the Paytm app is expected to continue operating seamlessly, allowing users to utilize existing balances without limitations.
With the government advising Paytm to collaborate with the RBI and adhere to their guidelines, the focus now shifts to a collaborative approach in resolving the regulatory challenges. Paytm’s commitment to compliance and innovation will play a pivotal role in determining the trajectory of its future interactions with regulatory authorities.