RBI action on Paytm Payments Bank: Regulatory compliance cannot be ‘optional’, says Rajeev Chandrasekhar

The issue of Paytm Payments Bank is a case where a hard-charging and aggressive entrepreneur has failed to realise the need for regulatory compliance, and that no company can get away if it is non-compliant with the law, said minister of state for electronics and IT Rajeev Chandrasekhar, as per the PTI report.

He also said that the RBI’s regulatory action on Paytm Payments Bank has drawn the attention of fintech firms to the importance of complying with the laws.

The central bank has barred Paytm Payments Bank from accepting new deposits from March 15, and ruled out any review of its action against the company. It has cited persistent non-compliances and continued material supervisory concerns, for the regulatory action.

The notion that RBI action on PPBL had rattled fintechs, was not a correct characterisation, said the minister.

“And this notion that RBI… the regulator’s action against Paytm Payments Bank has rattled fintech is… I don’t think that’s a correct characterisation,” Chandrasekhar said. “I think it has drawn the attention of fintech entrepreneurs, to the fact that you also have to know how to comply with the law. Regulatory compliance is not an optional thing for any country in the world, certainly not in India, and it is something that they (entrepreneurs) should pay more attention to.” 

Paytm Payments Bank is an associate of One97 Communications Limited. 

One97 Communications holds 49 per cent of the paid-up share capital (directly and through its subsidiary) of PPBL. Paytm founder and CEO Vijay Shekhar Sharma has a 51 per cent stake in the bank.

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Published: 18 Feb 2024, 06:38 PM IST