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NEW DELHI: Days after Reserve Bank of India’s (RBI) huge crack down on Paytm’s Payments Bank, sources mentioned on Sunday that authorities is now analyzing overseas direct investments from China within the fintech firm‘s cost aggregator subsidiary.
According to a PTI report, authorities is inspecting Chinese investments into Paytm Payments Services Ltd (PPSL), which utilized for a licence with RBI to function as a cost aggregator.
PPSL is a part of One97 Communications Ltd, which owns Paytm. One97 Communications Ltd (OCL) has funding from Chinese agency Ant Group Co.
The report mentioned that PPSL had utilized for a licence in November 2020 underneath the rules on Regulation of Payment Aggregators and Payment Gateways.
However, in November 2022, the apex financial institution rejected the applying and requested the corporate to resubmit it, in order to adjust to Press Note 3 underneath FDI guidelines.
In December 2022, the corporate filed utility with the federal government for previous downward funding from OCL into the corporate to be able to adjust to Press Note 3 prescribed underneath FDI tips.
Sources mentioned that an inter-ministerial committee is now analyzing investments from China in PPSL and choice could be taken on the FDI concern after due consideration and complete examination.
Under Press Note 3, the federal government had made its prior approval obligatory for overseas investments in any sector from international locations that share land border with India to curb opportunistic takeovers of home companies following the Covid-19 pandemic.
Countries which share land borders with India are China, Bangladesh, Pakistan, Bhutan, Nepal, Myanmar and Afghanistan.
Last month, in an enormous setback to the corporate, RBI barred Paytm Payments Bank Ltd (PPBL) from accepting deposits or top-ups in any buyer account, pay as you go devices, wallets, and FASTags, amongst others after February 29, 2024.
The Reserve Bank’s motion in opposition to PPBL follows a complete system audit report and subsequent compliance validation report of exterior auditors.
RBI had mentioned that these stories revealed persistent non-compliances and continued materials supervisory considerations in PPBL, warranting additional supervisory motion.
On March 11, 2022, RBI had barred PPBL from onboarding new prospects with instant impact.
According to a PTI report, authorities is inspecting Chinese investments into Paytm Payments Services Ltd (PPSL), which utilized for a licence with RBI to function as a cost aggregator.
PPSL is a part of One97 Communications Ltd, which owns Paytm. One97 Communications Ltd (OCL) has funding from Chinese agency Ant Group Co.
The report mentioned that PPSL had utilized for a licence in November 2020 underneath the rules on Regulation of Payment Aggregators and Payment Gateways.
However, in November 2022, the apex financial institution rejected the applying and requested the corporate to resubmit it, in order to adjust to Press Note 3 underneath FDI guidelines.
In December 2022, the corporate filed utility with the federal government for previous downward funding from OCL into the corporate to be able to adjust to Press Note 3 prescribed underneath FDI tips.
Sources mentioned that an inter-ministerial committee is now analyzing investments from China in PPSL and choice could be taken on the FDI concern after due consideration and complete examination.
Under Press Note 3, the federal government had made its prior approval obligatory for overseas investments in any sector from international locations that share land border with India to curb opportunistic takeovers of home companies following the Covid-19 pandemic.
Countries which share land borders with India are China, Bangladesh, Pakistan, Bhutan, Nepal, Myanmar and Afghanistan.
Last month, in an enormous setback to the corporate, RBI barred Paytm Payments Bank Ltd (PPBL) from accepting deposits or top-ups in any buyer account, pay as you go devices, wallets, and FASTags, amongst others after February 29, 2024.
The Reserve Bank’s motion in opposition to PPBL follows a complete system audit report and subsequent compliance validation report of exterior auditors.
RBI had mentioned that these stories revealed persistent non-compliances and continued materials supervisory considerations in PPBL, warranting additional supervisory motion.
On March 11, 2022, RBI had barred PPBL from onboarding new prospects with instant impact.
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