Paytm Shares Continue to Slide, Hit New Low of Rs 318.05

Paytm Shares Continue to Slide, Hit New Low of Rs 318.05

The stock price of Paytm, India’s leading fintech company, has been on a downward spiral since the Reserve Bank of India (RBI) imposed restrictions on its payments bank unit. On February 16, the shares of One97 Communications Ltd, the parent company of Paytm, fell by nearly 2 percent to touch a new all-time low of Rs 318.05 on the NSE. This is the fifth consecutive session of decline for the stock, which has lost 23 percent of its value in the last five trading days.

In the last five trading sessions, Paytm shares have tanked 23 percent, eroding investors' wealth.

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The RBI had ordered Paytm Payments Bank Ltd (PPBL) to stop accepting deposits or top-ups in any customer account, wallet, FASTag, or other instrument after February 29, 2024. The central bank also asked the bank to close the nodal accounts of its parent company and Paytm Payments Services by the same date. The RBI said that the action was taken due to “persistent non-compliances and material supervisory concerns” with the bank, which has over 100 million KYC verified customers and is the largest issuer of FASTags with over 8 million units.

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The RBI’s directive has raised questions about the future of Paytm’s core business model, which relies heavily on its payments bank and wallet services. Customers can still withdraw or use the balances from their Paytm accounts, but no other banking services, such as fund transfers, BBPOU and UPI facility, should be provided by the bank after February 29, the RBI said.

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Paytm Payments Bank, which was once the poster boy of India’s fintech revolution, has not issued any statement on the RBI’s directive. The bank’s founder and chairman Vijay Shekhar Sharma is also part-time chairman of the bank.
Paytm, which was once the poster boy of India’s fintech revolution, has not issued any statement on the RBI’s directive. The bank’s founder and chairman Vijay Shekhar Sharma is also part-time chairman of the bank

Source : Budget 2024

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