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Business News/ Companies / News/  'Too early…': Paytm advisory panel chief M Damodaran on identifying issues with fintech firm
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'Too early…': Paytm advisory panel chief M Damodaran on identifying issues with fintech firm

Paytm on February 9 announced setting up of a group advisory committee headed by Damodaran. The committee was set up to advise the company on strengthening compliance and on regulatory matters.

Paytm Payments Bank was asked by the RBI to not receive any payments in March 15 (Bloomberg)Premium
Paytm Payments Bank was asked by the RBI to not receive any payments in March 15 (Bloomberg)

The advisory committee, formed by Paytm owner One97 Communications after the Reserve Bank of India’s action on its payments bank, is yet to begin deeper conversations to identify any issue, the Press Trust of India reported the head of the panel M. Damodaran as having said on Sunday.

Also Read: The Paytm saga so far… from RBI intervention to stock crash and sale speculation

“We are an external advisor. At this point they (Paytm) are dealing with RBI," said Damodaran while speaking at the the release of his biography 'The Turmeric Latte' compiled by one of his former colleagues in Sebi (Securities and Exchange Board of India).

The former SEBI chairman also mentioned that the panel is at its too early stage and is yet to reach on the phase where it would be able to identify the problem.

“It is too early. We have not got to that stage," he said while responding to a question on his prima facie views on the issues that may have an impact on Paytm.

About Paytm fiasco

On January 31, the RBI asked Paytm Payments Bank Limited to stop further deposits, credit transactions, or top-ups in any customer accounts, prepaid instruments, wallets, FASTags, and National Common Mobility Cards, after February 29. Later, the deadline to halt transactions was extended till March 15.

After RBI's action on PPBL on February 9, Paytm announced to set up a group advisory committee headed by Damodaran. The prime role of the committee is to advise the company on strengthening compliance and regulatory matters.

RBI's action was the result of irregularities in KYC (know your customer) norms, compliance issues and related party transactions. The intervention stems from concerns about money laundering and questionable transactions involving crores of rupees.

RBI crackdown has taken a toll on Paytm's share market value which has dropped significantly since January 31. Between January 31 and February 2 this year, share of Paytm parent firm One97 Communications Ltd have declined by 36 per cent.

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Published: 25 Feb 2024, 10:06 PM IST
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