THE JHARKHAND STORY DESK
New Delhi, March 1: After the action of the Reserve Bank of India (RBI), the board of directors of One97 Communications, the company that operates Paytm, has approved the termination of inter-company agreements and amendments in shareholder agreements with its subsidiary Paytm Payments Bank Limited (PPBL).
This means that now Paytm Payments Bank will work as an independent entity separate from Paytm. This step has been taken to reduce the dependence between the two companies.
Nod to amend shareholders’ agreements
Paytm and PPBL have also mutually agreed to terminate various inter-company agreements with Paytm and its group entities.
Apart from this, the shareholders of PPBL have also agreed to simplify the Shareholders Agreement (SHA) for better governance of PPBL.
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Paytm had earlier announced that it would sign new partnerships with other banks and take steps to provide seamless services to its customers and merchants.
Paytm had also said that the Paytm App, Paytm QR, Paytm Soundbox and Paytm Card machines will continue to work uninterrupted.
Earlier Founder resigned as Chairman amid RBI’s action against PPBL
Paytm Payments Bank Limited (PPBL) is facing strict action from RBI for not complying with the rules.
RBI had barred PPBL from accepting new deposits or top-ups in customer accounts, wallets, Fastag and other instruments after February 29. However, later its deadline was extended to March 15.
After getting into trouble, Paytm founder Vijay Shekhar Sharma stepped down as part-time non-executive chairman of PPBL. Besides, the Board of Directors has also been reconstituted.
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