Paytm, PPBL to discontinue inter-company agreements amidst RBI restrictions
In January, the Reserve Bank of India imposed restrictions on PPBL, preventing it from accepting deposits, top-ups, and other transactions after March 15, 2024.
The board has given its approval to discontinue inter-company agreements with its associate entity, Paytm Payments Bank Limited (PPBL), the company said in a statement on Friday.
Additionally, Paytm shareholders have agreed to simplify the Shareholders Agreement to support
PPBL’s governance, independent of its shareholders, One 97 Communications, the parent company of Paytm, said in a regulatory filing.
Paytm had previously announced its intention to establish new partnerships with other banks and ensure seamless services to customers and merchants after the Reserve Bank of India imposed restrictions on PPBL, preventing it from accepting deposits, top-ups, and other transactions after March 15, 2024.
One97 Communications has reportedly entered into an agreement to transfer its merchant accounts to Yes Bank, according to NDTV Profit. Earlier, Yes Bank CEO Prashant Kumar had said the bank was willing to acquire PPBL’s merchants.
Additionally, Paytm is reportedly in the process of applying for a third-party application provider licence from the National Payment Corporation of India (NPCI) with the cooperation of Yes Bank and Axis Bank.
As the deal is close to be finalised, and all the necessary documentation has been filed, it is anticipated that NPCI approval will be granted shortly, the report said.
On Thursday, SoftBank Group reportedly decreased its stake in Paytm by 2.2%, selling over 1.3 crore shares in One 97 Communications.
Edited by Megha Reddy