Paytm Payments Bank Says RBI Curbs to be Lifted in 3 to 5 Months

In March, the RBI had ordered an audit of Paytm's IT systems, citing "material" supervisory concerns, and barred it from taking on new customers.

By Reuters | Updated: 23 May 2022 10:02 IST

Paytm Payments Bank Says RBI Curbs to be Lifted in 3 to 5 Months

The bank is working with the RBI to complete the IT audit

Highlights

Paytm is backed by China's Alibaba Group Holding and Ant Group
The parent of Paytm reported a wider fourth-quarter loss
Paytm shares have sunk 70 percent since its stock debut in November

India's Paytm Payments Bank, which facilitates transactions on mobile commerce platform Paytm, expects the central bank to allow it to resume taking on new customers in the next few months, a top executive told Reuters.

In March, the Reserve Bank of India ordered a comprehensive audit of the company's IT systems, citing "material" supervisory concerns, without elaborating further, and barring it from taking on new customers.

The bank is working with the RBI to complete the IT audit and address the regulator's concerns.

Paytm Says Will Purge 28 Million Tokenised Cards by June 30

"The process is underway and we think it should take three to five months from where we are right now," Madhur Deora, group chief financial officer, Paytm, told Reuters on Sunday.

The central bank did not immediately respond to an email seeking comments.

Paytm in March denied a Bloomberg news report that said RBI had found its servers were sharing information with China-based entities that indirectly own a stake in the firm.

How to Send Money Using UPI Without Internet

Paytm is backed by China's Alibaba Group Holding and its affiliate Ant Group.

One 97 Communications Ltd, the parent of fintech firm Paytm, on Friday reported a wider fourth-quarter loss due to higher payment processing, marketing and employee costs.

Deora said the company was on track to achieve profitability by September 2023.

"We are seeing good growth in high margin businesses and as a result we are seeing improvements in contribution margin."

"Our indirect expenses will not grow as fast as last year as we don't expect to make any significant investments in new businesses or employee cost this year as we have already made those in the last year," he added.

Paytm made its stock market debut in November last year in one of the country's biggest-ever initial public offerings, but the shares have since sunk 70 percent.

Should you pick Vivo over Galaxy S22 and OnePlus 10 Pro? We discuss this on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.

Affiliate links may be automatically generated - see our ethics statement for details.

Comments

For the latest tech news and reviews, follow Gadgets 360 on X, Facebook, WhatsApp, Threads and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel. If you want to know everything about top influencers, follow our in-house Who'sThat360 on Instagram and YouTube.