Paytm founder Vijay Shekhar Sharma has resigned as part-time non-executive Chairman of Paytm Payments Bank Limited (PPBL) ahead of the company’s March 15 deadline to wind down operations.
PPBL has also reconstituted its Board of Directors, with the appointment of former Central Bank of India Chairman Srinivasan Sridhar, retired IAS officer Debendranath Sarangi, former Executive Director of Bank of Baroda Ashok Kumar Garg, and former IAS officer Rajni Sekhri Sibal, according to a regulatory filing on Monday by One 97 Communications Limited.
“The company has been separately informed that Vijay Shekhar Sharma has also resigned from the Board of Paytm Payments Bank to enable this transition. PPBL has informed us that they will commence the process of appointing a new Chairman,” the filing said.
Sharma holds 51% of Paytm Payments Bank, while the remaining shares are owned by One 97 Communications, also known as Paytm.
The new board members’ expertise will be “pivotal in guiding us toward enhancing our governance structures and operational standards, further solidifying our dedication to compliance and best practices”, Surinder Chawla, CEO, Paytm Payments Bank, said.
The judgement comes amid the RBI’s assault on the payments bank due to continuous non-compliance and supervisory issues.
The banking authority had ordered the fintech firm to cease all banking activity after February 29 and later extended the deadline until March 15.
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“The comprehensive system audit report and subsequent compliance validation report of the external auditors revealed persistent non-compliances and continued material supervisory concerns in the bank, warranting further supervisory action,” the RBI said in a statement on its website.
The RBI stated that the bank will be prohibited from accepting additional deposits, conducting credit transactions, or topping up any client accounts, prepaid instruments, wallets, or cards used to pay road tolls. However, interest, cashback, and refunds can be credited at any moment.
