“Paytm Firmly Denies ED Probe Amid Regulatory Scrutiny Over Payments Bank”

Amidst swirling reports of an investigation by the Enforcement Directorate (ED), Paytm has issued a firm denial, refuting claims of any FEMA violation cases filed against the company. The fintech giant addressed these concerns in an exchange filing to both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), seeking to quell speculation surrounding the matter.

In its filing, One 97 Communications Limited, the parent company of Paytm and Paytm Payments Bank, clarified that its subsidiary, Paytm Payments Bank, does not engage in Outward Foreign Remittances. Furthermore, the company emphasized its commitment to cooperating with authorities, providing necessary information, documents, and explanations as requested.

“We would also like to clarify that our associate Paytm Payments Bank Limited does not undertake Outward Foreign Remittances,” stated One97 in the filing. “We have always made and will continue to make disclosures with our obligations under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.”

Paytm vehemently dismissed reports of an ED case, labeling them as “baseless, misleading, and malicious.” This staunch rebuttal comes amidst heightened scrutiny and a looming deadline for Paytm Payments Bank.

The controversy surrounding Paytm Payments Bank has intensified as the Reserve Bank of India (RBI) revealed violations of various regulations, including Know Your Customer (KYC) norms. According to RBI findings, numerous accounts within the bank were operating without proper KYC documentation, raising concerns about potential money laundering risks and data security breaches.

The RBI’s audit report highlighted significant procedural lapses by Paytm Payments Bank, citing a failure to conduct thorough background checks on the sources of deposited funds. This revelation has cast a shadow over the bank’s compliance measures and operational integrity.

As Paytm Payments Bank faces mounting regulatory pressure and a looming February 29 deadline set by the RBI, which mandates halting all transactions and deposits, the company finds itself at the center of a contentious regulatory saga, grappling with reputational challenges and escalating scrutiny from authorities.

In light of these developments, Paytm’s response seeks to assuage investor concerns and reaffirm its commitment to regulatory compliance while navigating the turbulent waters of the financial services landscape.

Sources By Agencies

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