New Delhi: Surinder Chawla, the Managing Director and CEO of Paytm Payments Bank (PPBL), has resigned from his position, as disclosed in a regulatory filing on Tuesday. His departure comes amid challenges faced by PPBL from the Reserve Bank of India (RBI). Chawla, who assumed his role in January the previous year following RBI’s approval, cited personal reasons and a desire to explore new career opportunities for his resignation. He is scheduled to be relieved from his duties at PPBL by the end of business hours on June 26, 2024, unless otherwise agreed upon mutually.
RBI had taken significant regulatory actions against PPBL, including directing it to halt the acceptance of deposits or top-ups in various customer accounts and instruments, with deadlines initially set for February 29 and later extended to March 15. These actions were prompted by persistent non-compliance and ongoing supervisory concerns outlined by the central bank. Additionally, on March 11, 2022, RBI prohibited PPBL from onboarding new customers with immediate effect.
As a consequence of these regulatory measures, Vijay Shekhar Sharma, the promoter of PPBL, resigned from his position as part-time non-executive Chairman. The bank’s board was subsequently reconstituted, with notable appointments including Srinivasan Sridhar, former chairman of Central Bank of India, Ashok Kumar Garg, former Executive Director of Bank of Baroda, and two retired Indian Administrative Service (IAS) officers.
One97 Communications Limited (OCL) holds a 49 percent stake in PPBL. The company disclosed that most agreements between itself and PPBL have been terminated, and the bank’s board has been restructured to include five independent directors, including an independent chairperson, with no representation from the company. Paytm also announced its ongoing efforts to collaborate with banking partners to enhance its merchant acquiring and Unified Payments Interface (UPI) services.
Furthermore, the National Payments Corporation of India (NPCI) recently granted One97 Communications Ltd approval to participate in UPI as a Third-Party Application Provider (TPAP) under the multi-bank model. Axis Bank, HDFC Bank, State Bank of India, and YES Bank have been appointed as Payment System Provider (PSP) banks to facilitate transactions for Paytm.
