Paytm Crisis: In response to the recent regulatory measures imposed on Paytm Payments Bank by the Reserve Bank of India, a group of Indian startup founders has written to Prime Minister Narendra Modi, Finance Minister Nirmala Sitharaman, and the RBI. The founders urge them to initiate a constructive dialogue with the Fintech ecosystem, as reported by Moneycontrol.
The letter, signed by at least a dozen founders, including Murugavel Janakiraman of Bharat Matrimony, Deepak Shenoy of CapitalMind, Ritesh Malik of Innov8, Vishal Gondal of GOQii, Yashish Dahiya of PB Fintech, and Rajesh Magow of MakeMyTrip, expresses concern about the potential adverse impact of RBI’s sanctions on Paytm Payments Bank on the entire FinTech ecosystem. According to the founders, the recent directives may have far-reaching consequences and need reevaluation to safeguard the interests of customers and merchants.
The letter highlights that the stringent regulations against Paytm Payments Bank could negatively affect India’s image as a business-friendly nation. Excessive restrictions targeting prominent fintech innovators might create an impression of inconsistency and unpredictability, potentially discouraging potential investors and innovators from entering the Indian market.
The founders call for a review of RBI’s regulatory directions and suggest reassessing the proportionality of restrictions, taking into account their potential impact on Paytm Payments Bank, the Fintech ecosystem, and the broader economy. They also advocate for the provision of a reasonable timeframe for rectification, granting Paytm Payments Bank a clear and practical window to address identified deficiencies and demonstrate compliance.
In response to the crisis, Paytm founder Vijay Shekhar Sharma assured employees that there would be no layoffs. He expressed uncertainty about the situation but pledged to figure out the issues and reach out to the RBI to explore potential solutions.
