Paytm gets Sebi warning on old dealings with bank unit – Times of India

MUMBAI: Markets regulator Sebi has issued an administrative warning to Paytm over certain related-party transactions with its now defunct banking unit Paytm Payments Bank during FY22, which it said was conducted without the approval of the company’s audit committee or shareholders. The warning was related to two transactions with unapproved amounts of Rs 324 crore and Rs 36 crore, Paytm said in a stock exchange filing.
In a letter to the company dated July 15, Sebi said that the violations have been viewed “very seriously” and directed the firm to take measures to better its compliance mechanism. “You are, therefore, warned to be careful in future and improve your compliance standards to avoid recurrence of such instances in future, failing which appropriate enforcement action would be initiated in accordance with the law,” Sebi said. The regulator also directed Paytm to place the letter before its board for corrective action and submit a report on action taken within 10 days from that.
The stock price of Paytm ended at Rs 460 apiece on the BSE on Tuesday, down 2%. Paytm said that it is committed to upholding and demonstrating the highest compliance standards and shall also submit its response to Sebi.
One of India’s high-profile startups which broadened access to digital payments for scores of households and small merchants, the Noida-based fintech came under the regulatory scanner earlier this year after RBI flagged instances of persistent non-compliance at its banking unit and slapped crippling restrictions on PPBL.