One97 Communications, the parent company of Paytm, has decided to discontinue various inter-company agreements with payments bank, the company said on Friday. This comes ahead of the March 15 deadline set by the Reserve Bank of India (RBI) to end the operations of the Paytm Payments Bank.

"Pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we wish to inform you that, the Board of Directors of the Company on March 01, 2024, at 07:28 A.M. (IST), through circulation, have approved the discontinuation of various inter-company agreements with its associate entity, Paytm Payments Bank Limited (PPBL)," the company said in a statement.

Paytm, a major fintech firm in India, encountered trouble following the RBI's crackdown on the Paytm Payments Bank due to persistent non-compliance and ongoing material supervisory concerns. In a recent regulatory action, the central bank barred Paytm Payments Bank Limited from accepting fresh deposits or top-ups in customer accounts, wallets, FASTags, and other instruments after February 29, with the deadline later extended to March 15.

On February 26, Paytm founder Vijay Shekhar Sharma, stepped down as the Chairman of Paytm Payments Bank Limited and the board of the bank was reconstituted.

The PPBL has reconstituted its Board of Directors with the appointment of Ex-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.

One97 Communications, which is the owner of the Paytm brand, holds 49 per cent of the paid-up share capital directly and through its subsidiary of PPBL. Vijay Shekhar Sharma has a 51 per cent stake in the bank.

Source: India Today