“Paytm was like a daughter to me… who had an accident,” Vijay Shekhar Sharma

Paytm was like a daughter who had an accident and is now in intensive care, said founder and CEO Vijay Shekhar Sharma on the Paytm crisis

“For me, the company is like a daughter… we grew up, aspired to full profitability, made cash and so on. I saw it as a daughter on her way to an important entrance exam, but she had an accident and is now in intensive care,” said Sharma from a personal perspective.

Sharma acknowledged that the company could have done better and that lessons were learned at the JIIF Foundation Day in Delhi.

“On a professional level, I would rather say we should have done better, that’s no secret. We should have understood it better… and we had responsibilities that we should have fulfilled, and done much better… we learned our lesson,” he said.

One 97 Communications, the parent company of Paytm, reported a decline in revenue to ₹2,399 crore from ₹2,465 crore in the fourth quarter of fiscal 2023 compared to the previous year. Losses increased to ₹551 crore, from ₹168 Crore in the fourth quarter of FY 2023 year-on-year, largely due to depreciation ₹227 crore for its investment in Paytm Payments Bank Ltd, in which it holds 49%.

Earlier this year, the Reserve Bank of India had directed Paytm Payments Bank to restrict its operations after February 29, 2024, due to violations. The RBI issued this order due to non-compliance with KYC norms and money laundering concerns by Paytm. The RBI banned transactions such as deposit and credit facilities, no recharge of prepaid and postpaid accounts, fast recharge of tags and UPI transactions.

The payments bank had first come under the central bank’s scrutiny in 2018 when the RBI stopped opening new accounts due to licensing violations and non-compliance with KYC norms. In 2021, the payments bank was fined ₹1 Crore for submitting false information on money laundering concerns. In 2022, Paytm was banned from acquiring new customers.

Paytm Payments Bank is the banking arm of One97 Communications, founded by Vijay Shekhar Sharma in 2017. The bank had a user base of around 30 crore.