Startup founders write to PM, FM & RBI to review regulatory action on PPBL
The letter, endorsed by a dozen entrepreneurs, features names such as Yashish Dahiya of Policy Bazaar, Deepak Shenoy of Capital Mind, Murugavel Janakiraman of Bharat Matrimony, Rajesh Magow of MakeMyTrip, and Ritesh Malik of Innov 8, among others.
These founders have called on the regulator to re-evaluate its directive and engage in dialogue with the fintech industry.
Furthermore, the letter requests that the government allows a reasonable timeframe for Paytm Payments Bank to identify deficiencies and implement rectifications.
The signatories highlighted that ‘restrictive regulations’ could “hinder financial inclusion, curb economic development, and compromise India’s competitiveness on the global stage.”
“The recent years have seen commendable initiatives like the Ease of Doing Business reforms, aimed at attracting foreign investment and promoting domestic entrepreneurship. However, excessively stringent regulations targeting leading fintech innovators such as Paytm Payments Bank could convey a message of inconsistency and unpredictability, potentially deterring other prospective investors and innovators from entering the domestic market,” the letter stated.
On January 31, the RBI announced that no further deposits, credit transactions, or top-ups will be permitted in customer accounts, prepaid instruments, wallets, FASTags, National Common Mobility Card (NCMC) cards, etc., after February 29, 2024, except for interest, cashback, or refunds that may be credited at any time.
Previously, in March 2022, the RBI had instructed Paytm Payments Bank to halt the onboarding of new customers due to KYC violations and to appoint an audit firm.
Sources informed Business Standard last week that violations of Know Your Customer (KYC) norms, raising concerns of money laundering, have led the Reserve Bank of India (RBI) to take action against Paytm Payments Bank.
A group of start-up founders has written to the PM, the FM, and the Reserve Bank of India (RBI), urging a review of the regulator’s directive that ordered Paytm Payments Bank (PPBL) to cease major banking services after February 29.
The letter, endorsed by a dozen entrepreneurs, features names such as Yashish Dahiya of Policy Bazaar, Deepak Shenoy of Capital Mind, Murugavel Janakiraman of Bharat Matrimony, Rajesh Magow of MakeMyTrip, and Ritesh Malik of Innov 8, among others.
These founders have called on the regulator to re-evaluate its directive and engage in dialogue with the fintech industry.
Furthermore, the letter requests that the government allows a reasonable timeframe for Paytm Payments Bank to identify deficiencies and implement rectifications.
The signatories highlighted that ‘restrictive regulations’ could “hinder financial inclusion, curb economic development, and compromise India’s competitiveness on the global stage.”
They argued that actions taken against Paytm Payments Bank might deter potential investors from entering the Indian market due to stringent regulatory requirements.
“The recent years have seen commendable initiatives like the Ease of Doing Business reforms, aimed at attracting foreign investment and promoting domestic entrepreneurship. However, excessively stringent regulations targeting leading fintech innovators such as Paytm Payments Bank could convey a message of inconsistency and unpredictability, potentially deterring other prospective investors and innovators from entering the domestic market,” the letter stated.
On January 31, the RBI announced that no further deposits, credit transactions, or top-ups will be permitted in customer accounts, prepaid instruments, wallets, FASTags, National Common Mobility Card (NCMC) cards, etc., after February 29, 2024, except for interest, cashback, or refunds that may be credited at any time.
Previously, in March 2022, the RBI had instructed Paytm Payments Bank to halt the onboarding of new customers due to KYC violations and to appoint an audit firm.
Sources informed Business Standard last week that violations of Know Your Customer (KYC) norms, raising concerns of money laundering, have led the Reserve Bank of India (RBI) to take action against Paytm Payments Bank.
First Published: Feb 06 2024 | 10:12 AM IST