The Indian digital payments company Paytm's shares fell 10% to almost all-time lows on Monday, continuing a downward trend that began last week due to a regulatory crackdown on its banking division.
Since the Reserve Bank of India (RBI) instructed Paytm Payments Bank on Wednesday to cease taking new deposits in its accounts or well-known wallets as of March, Paytm has lost roughly $2.5 billion, or roughly 43% of its market value.
Just shy of the previous all-time low of 438.35 rupees, reached in November 2022, the stock dropped by its daily trading limit to 438.5 rupees ($5.28) on Monday.
The RBI's order caused a 20% decline in the stock on Thursday and Friday, which was its daily maximum. The order has significant implications for the operations of Paytm, the most popular digital payments service in India.
The Hindu Business Line daily revealed on Monday that Paytm is in preliminary discussions to sell its wallet division, which is a part of Paytm Payments Bank, with HDFC Bank and Jio Financial Services.
There were no comments on the issue from Paytm, Jio Financial, or HDFC Bank.
According to three people with knowledge of the situation, the RBI discovered that hundreds of thousands of Paytm Payments Bank accounts had been opened without the required documentation. The information was then forwarded to the nation's financial crime combating organisation.
The sources claim that the RBI is worried that some of the accounts may have been used for money laundering.
Sanjay Malhotra, the revenue secretary for India, told Reuters on Saturday that in the event that new allegations of fund syphoning are discovered, the financial crime fighting agency would look into Paytm Payments Bank.
Paytm refuted accusations of money laundering and stated that the Enforcement Directorate has never looked into the business or Paytm Payments Bank.
Paytm's daily trading limit was reduced from 20% to 10% by India's stock exchanges in response to the firm's Thursday and Friday market crashes.
(Source:www.theprint.in)
Since the Reserve Bank of India (RBI) instructed Paytm Payments Bank on Wednesday to cease taking new deposits in its accounts or well-known wallets as of March, Paytm has lost roughly $2.5 billion, or roughly 43% of its market value.
Just shy of the previous all-time low of 438.35 rupees, reached in November 2022, the stock dropped by its daily trading limit to 438.5 rupees ($5.28) on Monday.
The RBI's order caused a 20% decline in the stock on Thursday and Friday, which was its daily maximum. The order has significant implications for the operations of Paytm, the most popular digital payments service in India.
The Hindu Business Line daily revealed on Monday that Paytm is in preliminary discussions to sell its wallet division, which is a part of Paytm Payments Bank, with HDFC Bank and Jio Financial Services.
There were no comments on the issue from Paytm, Jio Financial, or HDFC Bank.
According to three people with knowledge of the situation, the RBI discovered that hundreds of thousands of Paytm Payments Bank accounts had been opened without the required documentation. The information was then forwarded to the nation's financial crime combating organisation.
The sources claim that the RBI is worried that some of the accounts may have been used for money laundering.
Sanjay Malhotra, the revenue secretary for India, told Reuters on Saturday that in the event that new allegations of fund syphoning are discovered, the financial crime fighting agency would look into Paytm Payments Bank.
Paytm refuted accusations of money laundering and stated that the Enforcement Directorate has never looked into the business or Paytm Payments Bank.
Paytm's daily trading limit was reduced from 20% to 10% by India's stock exchanges in response to the firm's Thursday and Friday market crashes.
(Source:www.theprint.in)
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