According to Reuters, the Enforcement Directorate launched a preliminary investigation on Paytm Payments Bank on Wednesday, citing a report from CNBC TV 18. The measure comes only days after the Reserve Bank of India (RBI) stopped the Paytm subsidiary from receiving new deposits beginning February 29.
The central agency’s move is a fresh setback to the Payments Back, especially after the RBI ruled out any review of its clampdown against the entity. “At the moment let me say very clearly there is no review of this (PPBL) decision. If your are expecting a review of the decision, let me very clearly say there is (going to be) no review of the decision,” RBI governor Shaktikanta Das had said.
“We have always complied with the requirements dutifully,” Paytm told CNBC-TV18. The report has no further details on the probe.
Last week, news agency Reuters had reported that the ED was probing if Paytm and the Payments Bank were involved in FEMA violations.
The fintech major had denied reports of either the company or founder Vijay Shekhar Sharma being probed by the agency. “We have consistently assured that neither Paytm nor any of its associates are under investigation by any regulatory agency. This stance has been further validated by recent statements from senior government officials. Our commitment remains unwavering towards operating in compliance with regulatory guidance and continuously enhancing our processes to further the reach of digital payments across India,” the company had said in a statement.
Last week, Sharma had met both the RBI and finance minister Nirmala Sitharaman amid the crisis hitting the Payments Bank. According to reports, the minister told the Paytm CEO that the RBI action was a regulatory exercise and the government cannot help the company with. Even the central bank had refused to grant concession to Payments Bank.
“We give sufficient time to every entity to comply and sometimes more than sufficient time to the entities for compliance. If they would comply, why would a regulator like us would have to take action?” Das said last week.
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Source: HT
