Paytm has announced that it has mutually agreed to discontinue various inter-company agreements with Paytm Payments Bank (PPBL). Paytm said the company and its associate entity, PPBL, introduced additional measures to strengthen their approach towards independent operations of PPBL.
“One 97 Communications Ltd (Paytm) would like to inform that the Company and its associate entity, Paytm Payments Bank Limited (PPBL), have introduced additional measures to strengthen their approach towards independent operations of PPBL,” Paytm said in a regulatory filing.
Paytm Payments Bank has been instructed by the Reserve Bank of India to halt its basic banking services from March 16. Earlier this week, on Monday, Vijay Shekhar Sharma – the founder of Paytm – announced his resignation from the board of Payments Bank, which replaced its directors with new inductees, mostly from the banking and bureaucratic fraternity.
Paytm had announced earlier that it would sign up new partnerships with other banks and take measures to provide seamless services for its customers and merchants. In its intimation to stock exchanges on Feb 1, 2024, the company had indicated the possible financial impact.
As informed earlier, One 97 Communications Limited and its services that include the Paytm app, Paytm QR, Paytm soundbox and Paytm Card machines will continue to work uninterrupted. Paytm is committed to uphold the highest standards of market leading innovation and technology enabled solutions for its customers.
The move to diassociate offerings and reduce dependency will see both Paytm and Payments Bank discontinue inter-company agreements. Paytm had earlier announced that it would sign up new partnerships with other banks and take measures to provide seamless services for its customers and merchants.
“As part of this process to reduce dependencies, Paytm and PPBL have mutually agreed to discontinue various inter-company agreements with Paytm and its group entities. Further, the shareholders of PPBL have agreed to simplify the Shareholders Agreement (SHA) to support PPBL’s governance, independent of its shareholders. The Board of OCL approved the termination of agreements and amendment of SHA on March 1, 2024,” said the filing.
Paytm also clarified in the filing that its services would continue to operate seamlessly amid scrutiny, saying it was “committed to uphold the highest standards of market leading innovation and technology-enabled solutions for its customers.”
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