Photo credit: Paytm
Indian fintech giant Paytm has announced that Surinder Chawla, CEO and managing director its banking unit, will resign on June 26 for personal reasons. The move comes about a month after the Reserve Bank of India (RBI) ordered Paytm Payments Bank to shut down operations.
Paytm founder Vijay Shekhar Sharma also quit the bank’s board in February. Sharma holds 51% of Paytm Payments Bank’s shares while the rest are held by Paytm parent company One 97 Communications.
Chawla’s resignation caps off a tumultuous start of the year for Paytm Payments Bank. RBI, India’s banking regulator, had mandated the winding down of bank by March 15 due to regulatory issues, causing a large drop in Paytm’s stock value.
Reuters also reported that Paytm Payments Bank was probed by the Enforcement Directorate, the government entity that looks into economic crimes and financial fraud.
Paytm’s shares plummeted nearly 50% after RBI’s directive. However, Paytm then terminated intercompany agreements with its affiliate bank in an effort to simplify its corporate structure.
The fintech firm has since won approval to become a third-party service provider on the country’s Unified Payments Interface (UPI) infrastructure. That paved the way for Paytm to launch UPI services backed by prominent Indian banks like Axis Bank, HDFC Bank, State Bank of India, and Yes Bank.
Paytm had launched the payments bank in 2017, offering savings accounts, business banking, and other services.
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Editing by Putra Muskita and Eileen C. Ang
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