Paytm denies reports of investigation into money laundering and FEMA violations; Preparation to sell wallet business

Regarding allegations in the media that the Enforcement Directorate (ED) is looking into Paytm or its founder for possible FEMA violations or money laundering, the company has refuted those reports. The reports, according to the fintech company, are malicious, false, and unfounded. In response to accusations of money laundering, Paytm said in a statement on Monday that the ED has not opened an investigation against One97 Communications, the parent company, or its founder and CEO, Vijay Shekhar Sharma.

Paytm said we want to clarify again that no such investigation is going on against the company and Paytm Payments Bank Limited. Such media reports are completely misleading, baseless and malicious, which harms the interests of all our stakeholders. The company also denied claims of alleged FEMA violations. The statement said that we have seen media reports making baseless speculations about an investigation against the company or its associate Paytm Payments Bank Limited (PPBL) for violations of foreign exchange regulations. Paytm will continue to share such clarifications as needed.

On the other hand, the controversy-plagued Paytm is thinking about selling its wallet division. Leading the race to acquire it are HDFC Bank and Jio Financial, owned by Mukesh Ambani. Paytm Payments Bank owns the wallet company. As of February 29, the RBI has prohibited Payments Bank from taking deposits. On Monday, Jio's stock closed 14% higher at Rs 289, a one-year high, following the announcement that Paytm was acquiring the wallet company. Throughout the day, it had increased to Rs 295. According to bankers, Paytm is no longer as interested in this industry as it was before 2022. This agreement with Jio would have been finalised sooner if the company's valuation had been reasonable.