Vijay Shekhar Sharma, the founder of Paytm, expressed optimism regarding the future trajectory of his digital payment venture despite recent regulatory hurdles in India. Speaking at a financial technology conference in Tokyo on Tuesday, March 5, Sharma addressed the setbacks faced by Paytm's banking affiliate, Paytm Payments Bank, and asserted his commitment to steering the company towards a stronger position.
This was his first public appearance since the Reserve Bank of India ordered Paytm bank to halt certain activities.
Sharma emphasised the importance of personal responsibility in navigating such situations. "It is important for you, yourself to be taking care of it versus just letting a teammate or an adviser suggest what it should be," Sharma remarked, underscoring the need for proactive leadership in times of adversity.
The regulatory constraints imposed on
Paytm Payments Bank have posed significant obstacles to the company's operations.
However, acknowledging the pivotal role of regulators in fostering a conducive environment for startups, Sharma emphasised the value of the role regulators play in creating a healthy environment for startups in India. Additionally, he affirmed Paytm's commitment to compliance and transparency, recognising the significance of regulatory oversight in maintaining market integrity.
The objective of this initiative is to guarantee smooth merchant settlements extending beyond March 15, the deadline set by the
Reserve Bank of India (RBI) for Paytm Payments Bank to cease all banking operations.
Previously, Paytm managed its nodal accounts through its own bank, Paytm Payments Bank. Paytm forged a partnership with Axis Bank to create a nodal Escrow Account tailored for OCL and Paytm Payment Services. Should ongoing negotiations yield positive results, Yes Bank is poised to become the second financial institution supporting these arrangements. This setup will enable the handling of large UPI transaction volumes that Paytm processes between the two banks.
Paytm is currently in the process of expanding its partnerships with additional banks. Sharma expressed the vision of establishing Paytm as a leader in the financial sector in Asia for the next generation.
"Asia has an opportunity to build a financial system for the next generation. Make Paytm an Asia leader — in my lifetime, I would like to do that ... Ambiguity brings stress," he said. "When you are clear, when you know, then it is the perseverance on the mission that you are in ... This is a great day when I have new lessons to learn and new opportunities to address," he said.
With a 51% ownership stake, Sharma is a majority shareholder of Paytm Payments Bank, while the remaining stake is held by Paytm. In response to regulatory actions, the banking affiliate underwent a board reconstitution, resulting in the appointment of four new directors.
Despite resigning from the board and stepping down from his part-time non-executive chairman role at Paytm Payments Bank, Sharma remains at the helm of Paytm, the platform he founded and has been guiding for over a decade.
With inputs from Bloomberg
