Paytm responds to report on show cause notice from SEBI

Paytm on Monday has responded to a recent media report which said that the market regulator (SEBI) has issued show-cause notices to the firm’s founder Vijay Shekhar Sharma, and board members who served during its initial public offering in November 2021.

As per a Moneycontrol report, the show cause notice has been issued for alleged misrepresentation of facts.

In a stock exchange filing, Paytm’s parent One97 Communications clarified that this is not a new development, as the company had already made relevant disclosures on this matter in its financial results for the quarter and year ended March 2024, as well as the quarter ended June 2024.

 “The Company is in regular communication with the Securities Exchange Board of India (SEBI) and making necessary representations regarding this matter. Accordingly, there is no impact on the financial results for previous quarters ended June 30, 2024, and March 31, 2024, respectively,” added Paytm.

The media report also said that the probe was initiated based on inputs from the Reserve Bank of India (RBI), which had examined Paytm Payments Bank earlier this year.

“We are committed to taking all necessary steps to ensure continued adherence to regulatory requirements and remain dedicated to transparency and compliance in all our actions,” said Paytm.

Last week, Paytm had proposed to reduce the remuneration paid to its board of directors. The firm is also seeking re-appointment of Elevation Capital’s founder Ravi Chandra Adusumalli to its board of directors.

The development coincided with Paytm’s selling its entertainment business to listed foodtech firm Zomato.