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MUMBAI : Paytm founder Vijay Shekhar Sharma has stepped down as non-executive chairman of Paytm Payments Bank as the lender overhauls its board in the face of regulatory strictures.

Sharma stepped down to aid the payments bank in the transition, parent company One97 Communications Ltd said in a regulatory filing on Monday. 

“Paytm Payments Bank Ltd (PPBL) has informed us that they will commence the process of appointing a new chairman,” One97 said in the filing, adding that it has also withdrawn its nominee from the Paytm Payments Bank board.

Paytm has initiated several urgent measures afloat after the Reserve Bank of India barred its payments bank from accepting any customer deposits after 29 February citing repeated non-compliance with its rules. This deadline was later revised to 15 March.

The payments bank has appointed Central Bank of India’s former chairman Srinivasan Sridhar, retired civil servants Debendranath Sarangi and Rajni Sekhri Sibal; and former executive director of Bank of Baroda Ashok Kumar Garg as independent directors on its board. 

Earlier, following the Reserve Bank of India’s crackdown on the payments bank for repeated non-compliance with its rules, independent director and former State Bank of India executive Manju Agarwal resigned from Paytm Payments Bank’s board. 

As per a regulatory disclosure, Agarwal resigned on 1 February over “personal commitments”, a day after RBI’s crackdown on the payments bank. 

The board of the payments bank also comprises Arvind Kumar Jain, former executive director of Punjab & Sind Bank, as an independent director; while former RBL Bank executive Surinder Chawla heads it as the managing director and chief executive.

Chawla was quoted in the regulatory filing as saying that the expertise of the new members will be pivotal in guiding the bank toward enhancing its governance structures and operational standards.

On 9 February, the board of One97 Communications said it had formed a group advisory committee of three members, chaired by former Securities and Exchange Board of India chairman M. Damodaran.

On Friday, RBI instructed the National Payments Corporation of India to review One97 Communication’s request to become a third-party application provider for UPI payments on the Paytm app.

On Monday, shares of One97 gained 4.99% on BSE to end trading at 427.95 apiece.

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Published: 26 Feb 2024, 09:27 PM IST

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