Paytm to set up advisory panel

MUMBAI: Paytm‘s parent company One 97 Communications on Friday said that it will form a group advisory committee chaired by former Sebi chairman M Damodaran to help its board strengthen compliance and regulatory matters.
The committee will also include former Institute of Chartered Accountants of India president M M Chitale and and banking veterans like R Ramachandran, former chairman & MD of Andhra Bank.
The appointment of a high profile panel with members who have advised Sebi and RBI in the past, is seen as a move to position the listed company as following corporate governance standards. The fact that Paytm is having the panel at the parent company and not at the bank, which is facing charges also seems to indicate that the main focus of Paytm is the distribution business, which also owns the app and not the wallet business in the bank.
Paytm said that the committee will induct additional members, as necessary. “The company’s management is committed to drive sustainable business growth, while adhering to a regulatory and compliance framework,” the firm said in a statement.
The development comes amid RBI’s move to curb operations of Paytm Payments Bank. The central bank has directed the bank to stop accepting money in customer accounts, including wallets and other prepaid instruments such as Fastags, national common mobility cards used in metro, or any other instrument from March 1, citing “persistent non-compliance”.
RBI found lakhs of instances of alleged KYC violations by the bank, raising concerns of money laundering along with its inability to maintain arm’s length relationship with its parent, resulting in the agency putting severe restrictions on it, TOI had reported earlier. Paytm founder & CEO Vijay Shekhar Sharma holds a 51% stake in the bank and One 97 holds 49%. On Thursday, RBI governor Shaktikanta Das said the the restrictions are proportionate to the “gravity of the situation”.

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