📷 Image Credits: Mint
Paytm Founder and Managing Director Vijay Shekhar Sharma recently made an emotional analogy, comparing the current crisis faced by Paytm to that of a daughter in critical condition in the ICU. Sharma expressed his deep personal attachment to the company, stating that he saw Paytm as a daughter preparing for an important test, but unfortunately met with an accident, leaving her in ICU. Speaking at the JIIF Foundation Day event in Delhi, Sharma also acknowledged that there were areas where Paytm could have performed better and that they have learned valuable lessons from the experience.
On a professional level, Sharma admitted that there were shortcomings in managing the company, emphasizing the need for better understanding and fulfilling responsibilities more effectively. He reflected on the financial performance of One 97 Communications, the parent company of Paytm, reporting a decline in revenue to ₹2,399 crore from ₹2,465 crore in Q4 FY23, as well as widening losses to ₹551 crore from ₹168 crore in the same period, primarily due to writing off ₹227 crore on investment in Paytm Payments Bank Ltd.
Earlier this year, Paytm Payments Bank faced regulatory restrictions imposed by the Reserve Bank of India (RBI) for non-compliance with KYC norms and money laundering concerns, leading to a ban on certain operations as of 29th February 2024. This was not the first time the payments bank had come under scrutiny, as in 2018, the RBI halted the opening of new accounts due to licensing violations. Subsequent fines and restrictions in 2021 and 2022 added to the challenges faced by Paytm Payments Bank.
Paytm Payments Bank, a subsidiary of One97 Communications, was founded by Vijay Shekhar Sharma in 2017 and boasts a significant user base of around 30 crore. The company is now focused on navigating through the crisis period and leveraging the lessons learned to emerge stronger in the future.
