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Paytm shares drop 20% in early trade, day after RBI action on its payment bank
Paytm share price today: Paytm shares tumble 20% in the early trade, a day after RBI's action on its payment bank.
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Paytm stocks: Paytm shares dropped 20 per cent in early trade, a day after the Reserve Bank of India ordered its wholly-owned subsidiary Paytm Payments Bank to stop taking deposits from March 1.
Paytm share price
Paytm's share on Thursday opened at a six-week low of ₹608.8. It touched 20 per cent lower cicuit at just start of the trading session.
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What is RBI's order on Paytm Payments Bank?
The Reserve Bank in its order on Wednesday instructed Paytm Payments Bank to cease accepting new deposits without specifying a review timeline for the imposed restrictions. Existing customers may still get interest, cashbacks, or refunds credited back.
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"No other banking services, other than those...like fund transfers (irrespective of name and nature of services like AEPS, IMPS, etc), BBPOU and UPI facility should be provided by the bank after February 29, 2024," the RBI added.
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How will the ban affect Paytm?
Paytm said on Thursday that it sees a potential adverse impact on its annual earnings in the range of ₹300 to 500 crore due to the RBI's directive.
One 97 is one of India's largest payment firms, with early investments from SoftBank and Ant Financial. As per the company's annual report for 2022-23, it owns a 49 per cent stake in Paytm Payments Bank, while CEO Vijay Shekhar Sharma holds the remaining 51 per cent. The bank obtained its license in 2015.
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Paytm on Thursday clarified that its founder, Vijay Shekhar Sharma, has not engaged in margin loans or pledged any shares directly or indirectly owned by him. It further clarified that Paytm Payments Bank Limited operates independently under its management and board.
