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Vijay Shekhar Sharma exits Paytm Bank board; FM meets startup, fintech CEOs
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Vijay Shekhar Sharma is stepping down as part-time non-executive chairman and board member at Paytm Payments Bank as part of a restructuring. This and more in today’s ETtech Morning Dispatch.
Also in the letter:
■ MCA asks to expedite Byju’s probe
■ Amazon Pay secures PA licence
■ ETtech Done Deals
![Why did Paytm shares surge Vijay Shekhar Sharma Why did Paytm shares surge Vijay Shekhar Sharma](https://img.etimg.com/photo/msid-108025642/Why did Paytm shares surge Vijay Shekhar Sharma.jpg)
One 97 Communications Ltd (OCL), which runs Paytm, on Monday said founder Vijay Shekhar Sharma will be stepping down as part-time non-executive chairman and board member at associate entity Paytm Payments Bank Ltd (PPBL). The parent also withdrew all nominees from the payments bank’s board.
New board: The troubled PPBL, on which restrictions were imposed by the central bank due to compliance issues on January 31, has brought new faces to the table.
PPBL’s reconstituted board now includes former Central Bank of India chairman Srinivasan Sridhar, retired IAS officers Debendranath Sarangi and Rajni Sekhri Sibal, as well as former executive director of Bank of Baroda Ashok Kumar Garg.
Word for word: “OCL supports PPBL’s move of opting for a board with only independent and executive directors by removing its nominee. PPBL has informed us that they will commence the process of appointing a new Chairman,” One 97 said in its communication to the exchanges.
Other exits: PPBL saw two independent directors, including former State Bank of India senior executive Manju Agarwal and former central banker Shinjini Kumar resign from its board on February 1 and earlier in December respectively.
Recap: ET had reported on February 10 citing sources that Sharma had considered resigning from the payments bank board last year and removing ‘Paytm’ from its name to ‘quell mounting regulatory and compliance pressures on the fintech firm.’
![Paytm and its rivals Zaggle and Pluxee_competition in mobile wallet space_THUMB IMAGE_ETTECH Paytm and its rivals Zaggle and Pluxee_competition in mobile wallet space_THUMB IMAGE_ETTECH](https://img.etimg.com/photo/msid-108025655/Paytm and its rivals Zaggle and Pluxee_competition in mobile wallet space_THUMB IMAGE_ETTECH.jpg)
Banks, fintechs eye Paytm’s staff benefits business: Meanwhile, hawks are circling around Paytm’s employee benefits business, as the fintech’s exit from the employee benefits market becomes imminent following regulatory action.
Recently, Sodexo, which is also into facilities management and other businesses, hived off its meal benefits business as Pluxee.
Leader board shake-up: “Paytm with its superior wallet offering and acceptance across the country had managed to grab a large market share in this business and was second competing with Sodexo, but now the leader board is set to get disrupted,” a fintech executive told ET.
Also read | Paytm’s forex woes: Understanding the role of fintechs in cross-border payments
![Nirmala Sitharaman Nirmala Sitharaman](https://img.etimg.com/photo/msid-108025665/Nirmala Sitharaman.jpg)
Finance minister Nirmala Sitharaman on Monday asked regulators including the Reserve Bank of India (RBI) to hold monthly virtual meetings with startups and fintechs to address their concerns while emphasising strict regulatory compliance.
Driving the news: Sitharaman met startup and fintech stakeholders on Monday along with senior government officials and discussed issues related to cybersecurity, foreign direct investment policy, and data sharing. According to an official, no Paytm-related anxiety or concerns were shown by those in attendance.
![Untitled Untitled](https://img.etimg.com/photo/msid-108025675/Untitled.jpg)
Action points: The finance ministry put out six action points after the meeting which included simplification and digitisation of KYC (Know Your Customer) across all fintech segments and interaction with law enforcement agencies to allow fintech firms to voice their issues or concerns.
Compliance first: "The RBI, Department for Promotion of Industry and Internal Trade (DPIIT) and the finance ministry will look at the change of ownership holding or control of listed fintech companies to enable them to be in sync with regulatory compliance," the finance ministry said in a statement. The Department of Financial Services (DFS) will conduct workshops with the fintech industry and law enforcement agencies, the statement added.
Recap: ET had reported last week that Sitharaman will meet heads of fintech firms in the backdrop of the RBI's action against Paytm Payments Bank, to reassure the industry that the sector remains a key priority for the government. Following the regulator's move, a group of startup founders had written to Sitharaman, seeking reassessment of the stringent action.
Also read | Plans afoot to digitalise KYC, curb illegal online lending
![byju raveendran. byjus byju raveendran. byjus](https://img.etimg.com/photo/msid-108025684/byju raveendran. byjus.jpg)
The Ministry of Corporate Affairs (MCA) has asked officials to expedite a probe into edtech firm Byju’s—ordered in July last year to ascertain any potential corporate governance lapses—and submit the inspection report at the earliest, a senior official told ET.
Driving the news: Based on the findings of the probe, the ministry will take a final call on the next course of action – whether the matter needs to be referred to the Serious Fraud Investigation Office (SFIO) or the National Financial Reporting Authority (NFRA), the official said.
![Byjus Byjus](https://img.etimg.com/photo/msid-108025735/Byjus.jpg)
While NFRA currently does not have remit over a private limited company like Byju’s, the audit regulator is empowered to initiate a probe into any case if the government asks it to do so, another person said.
Under scrutiny: Byju’s had come under the scanner of the MCA, regulators and probe agencies last year, especially after the resignation of three directors and auditor Deloitte, over an inordinate delay in the announcement of its financial results, among other issues.
ETtech Explainer: What to know about Byju’s boardroom battle and shareholder resolutions
Byju’s woes: Last week, a majority of Byju's shareholders voted to remove founder Byju Raveendran from the post of chief executive officer (CEO). However, the company called the vote ‘invalid’ and insisted that Raveendran remained the CEO.
In a letter to employees, Raveendran termed the board meeting a ‘farce’, and said there are no changes to the edtech board. Read the full letter here.
![amazon-pay-wallets_thumb-image_ettech. amazon-pay-wallets_thumb-image_ettech.](https://img.etimg.com/photo/msid-108025711/amazon-pay-wallets_thumb-image_ettech..jpg)
Amazon Pay secures payment aggregator licence from RBI: Amazon Pay, the digital payments arm of ecommerce major Amazon India, has received a payment aggregator (PA) licence from the Reserve Bank of India (RBI). It now joins the likes of Zomato, Google Pay, Zoho and others to become eligible to offer online merchant payment services to its clients.
D2C luggage brand Mokobara raises $12 million: Internet-first direct-to-consumer luggage brand Mokobara has raised $12 million (Rs 100 crore) in a funding round led by Peak XV Partners, at a valuation of $80 million post-money.
Tata Digital-backed Cult.fit raises $10 million: Health and fitness platform Cult.fit has raised Rs 84.5 crore (around $10.2 million) in a round led by existing backer Valecha Investments. Gul Advani of Sun-n-Sand Hotels, Extreme Brands, L&K Wellness Services also participated in the round.
Blume Ventures invests $10 million in edtech firm Interview Kickstart: US-based Interview Kickstart acts as a platform for working technology professionals.
Spacetech startup Spacefields raises $800,000: Spacefields, which designs and builds dual-use rocket propulsion systems, has raised $800,000 (Rs 6.5 crore) in a seed round led by HVB 88 Angels and O2 Angels Network. This is the first round of institutional and external fundraise at the company.
Adani in talks with Uber to own, operate an EV fleet: Billionaire Gautam Adani and Uber CEO Dara Khosrowshahi last week discussed the strategic alliance whereby Adani Group is looking to become a fleet operator by purchasing and listing hundreds of electric four-wheelers on Uber, sources said.
‘GenAI set to move from hype to value as projects go live’: Several experimental generative artificial intelligence (GenAI) projects are expected to go live this year, helping clients drive greater value from the technology, Harrick Vin, chief technology officer, Tata Consultancy Services, told ET. “We are currently engaged in over 250 different projects in various categories, but they are all mainly in assist and augment categories,” said Vin, who took over the role in July.
Relook parts of draft cybercrime treaty: Rights groups to UN panel: More than 40 civil societies and international digital rights organisations, including Access Now, Human Rights Watch, Privacy International and others, have approached the ad-hoc UN committee on cybercrime requesting it reconsider some of the provisions of the draft treaty currently being considered by the member nations.
■ How a small US newspaper’s website became an AI-generated clickbait factory (Wired)
■ They wanted careers in tech. They’re stuck as TikTok moderators (Rest of World)
■ Why some cyber-attacks hit harder than others (BBC)
Also in the letter:
■ MCA asks to expedite Byju’s probe
■ Amazon Pay secures PA licence
■ ETtech Done Deals
Vijay Shekhar Sharma steps down as Paytm Payments Bank chair; board reconstituted
![Why did Paytm shares surge Vijay Shekhar Sharma Why did Paytm shares surge Vijay Shekhar Sharma](https://img.etimg.com/photo/msid-108025642/Why did Paytm shares surge Vijay Shekhar Sharma.jpg)
One 97 Communications Ltd (OCL), which runs Paytm, on Monday said founder Vijay Shekhar Sharma will be stepping down as part-time non-executive chairman and board member at associate entity Paytm Payments Bank Ltd (PPBL). The parent also withdrew all nominees from the payments bank’s board.
New board: The troubled PPBL, on which restrictions were imposed by the central bank due to compliance issues on January 31, has brought new faces to the table.
PPBL’s reconstituted board now includes former Central Bank of India chairman Srinivasan Sridhar, retired IAS officers Debendranath Sarangi and Rajni Sekhri Sibal, as well as former executive director of Bank of Baroda Ashok Kumar Garg.
Word for word: “OCL supports PPBL’s move of opting for a board with only independent and executive directors by removing its nominee. PPBL has informed us that they will commence the process of appointing a new Chairman,” One 97 said in its communication to the exchanges.
Other exits: PPBL saw two independent directors, including former State Bank of India senior executive Manju Agarwal and former central banker Shinjini Kumar resign from its board on February 1 and earlier in December respectively.
Recap: ET had reported on February 10 citing sources that Sharma had considered resigning from the payments bank board last year and removing ‘Paytm’ from its name to ‘quell mounting regulatory and compliance pressures on the fintech firm.’
![Paytm and its rivals Zaggle and Pluxee_competition in mobile wallet space_THUMB IMAGE_ETTECH Paytm and its rivals Zaggle and Pluxee_competition in mobile wallet space_THUMB IMAGE_ETTECH](https://img.etimg.com/photo/msid-108025655/Paytm and its rivals Zaggle and Pluxee_competition in mobile wallet space_THUMB IMAGE_ETTECH.jpg)
Banks, fintechs eye Paytm’s staff benefits business: Meanwhile, hawks are circling around Paytm’s employee benefits business, as the fintech’s exit from the employee benefits market becomes imminent following regulatory action.
- Zaggle, which offers prepaid payment services to corporates, is looking to onboard 100-150 new corporate clients by the end of the next financial year
- Pluxee, the employee benefit business of Sodexo that was recently hived off, is also looking to tap into fresh opportunities
Recently, Sodexo, which is also into facilities management and other businesses, hived off its meal benefits business as Pluxee.
Leader board shake-up: “Paytm with its superior wallet offering and acceptance across the country had managed to grab a large market share in this business and was second competing with Sodexo, but now the leader board is set to get disrupted,” a fintech executive told ET.
Also read | Paytm’s forex woes: Understanding the role of fintechs in cross-border payments
FM asks RBI, fintechs to hold monthly meetings in wake of Paytm crisis
![Nirmala Sitharaman Nirmala Sitharaman](https://img.etimg.com/photo/msid-108025665/Nirmala Sitharaman.jpg)
Finance minister Nirmala Sitharaman on Monday asked regulators including the Reserve Bank of India (RBI) to hold monthly virtual meetings with startups and fintechs to address their concerns while emphasising strict regulatory compliance.
Driving the news: Sitharaman met startup and fintech stakeholders on Monday along with senior government officials and discussed issues related to cybersecurity, foreign direct investment policy, and data sharing. According to an official, no Paytm-related anxiety or concerns were shown by those in attendance.
![Untitled Untitled](https://img.etimg.com/photo/msid-108025675/Untitled.jpg)
Action points: The finance ministry put out six action points after the meeting which included simplification and digitisation of KYC (Know Your Customer) across all fintech segments and interaction with law enforcement agencies to allow fintech firms to voice their issues or concerns.
Compliance first: "The RBI, Department for Promotion of Industry and Internal Trade (DPIIT) and the finance ministry will look at the change of ownership holding or control of listed fintech companies to enable them to be in sync with regulatory compliance," the finance ministry said in a statement. The Department of Financial Services (DFS) will conduct workshops with the fintech industry and law enforcement agencies, the statement added.
Recap: ET had reported last week that Sitharaman will meet heads of fintech firms in the backdrop of the RBI's action against Paytm Payments Bank, to reassure the industry that the sector remains a key priority for the government. Following the regulator's move, a group of startup founders had written to Sitharaman, seeking reassessment of the stringent action.
Also read | Plans afoot to digitalise KYC, curb illegal online lending
Submit Byju’s report soon: MCA to officials
![byju raveendran. byjus byju raveendran. byjus](https://img.etimg.com/photo/msid-108025684/byju raveendran. byjus.jpg)
The Ministry of Corporate Affairs (MCA) has asked officials to expedite a probe into edtech firm Byju’s—ordered in July last year to ascertain any potential corporate governance lapses—and submit the inspection report at the earliest, a senior official told ET.
Driving the news: Based on the findings of the probe, the ministry will take a final call on the next course of action – whether the matter needs to be referred to the Serious Fraud Investigation Office (SFIO) or the National Financial Reporting Authority (NFRA), the official said.
![Byjus Byjus](https://img.etimg.com/photo/msid-108025735/Byjus.jpg)
While NFRA currently does not have remit over a private limited company like Byju’s, the audit regulator is empowered to initiate a probe into any case if the government asks it to do so, another person said.
Under scrutiny: Byju’s had come under the scanner of the MCA, regulators and probe agencies last year, especially after the resignation of three directors and auditor Deloitte, over an inordinate delay in the announcement of its financial results, among other issues.
ETtech Explainer: What to know about Byju’s boardroom battle and shareholder resolutions
Byju’s woes: Last week, a majority of Byju's shareholders voted to remove founder Byju Raveendran from the post of chief executive officer (CEO). However, the company called the vote ‘invalid’ and insisted that Raveendran remained the CEO.
In a letter to employees, Raveendran termed the board meeting a ‘farce’, and said there are no changes to the edtech board. Read the full letter here.
Other Top Stories By Our Reporters
![amazon-pay-wallets_thumb-image_ettech. amazon-pay-wallets_thumb-image_ettech.](https://img.etimg.com/photo/msid-108025711/amazon-pay-wallets_thumb-image_ettech..jpg)
Amazon Pay secures payment aggregator licence from RBI: Amazon Pay, the digital payments arm of ecommerce major Amazon India, has received a payment aggregator (PA) licence from the Reserve Bank of India (RBI). It now joins the likes of Zomato, Google Pay, Zoho and others to become eligible to offer online merchant payment services to its clients.
D2C luggage brand Mokobara raises $12 million: Internet-first direct-to-consumer luggage brand Mokobara has raised $12 million (Rs 100 crore) in a funding round led by Peak XV Partners, at a valuation of $80 million post-money.
Tata Digital-backed Cult.fit raises $10 million: Health and fitness platform Cult.fit has raised Rs 84.5 crore (around $10.2 million) in a round led by existing backer Valecha Investments. Gul Advani of Sun-n-Sand Hotels, Extreme Brands, L&K Wellness Services also participated in the round.
Blume Ventures invests $10 million in edtech firm Interview Kickstart: US-based Interview Kickstart acts as a platform for working technology professionals.
Spacetech startup Spacefields raises $800,000: Spacefields, which designs and builds dual-use rocket propulsion systems, has raised $800,000 (Rs 6.5 crore) in a seed round led by HVB 88 Angels and O2 Angels Network. This is the first round of institutional and external fundraise at the company.
Adani in talks with Uber to own, operate an EV fleet: Billionaire Gautam Adani and Uber CEO Dara Khosrowshahi last week discussed the strategic alliance whereby Adani Group is looking to become a fleet operator by purchasing and listing hundreds of electric four-wheelers on Uber, sources said.
‘GenAI set to move from hype to value as projects go live’: Several experimental generative artificial intelligence (GenAI) projects are expected to go live this year, helping clients drive greater value from the technology, Harrick Vin, chief technology officer, Tata Consultancy Services, told ET. “We are currently engaged in over 250 different projects in various categories, but they are all mainly in assist and augment categories,” said Vin, who took over the role in July.
Relook parts of draft cybercrime treaty: Rights groups to UN panel: More than 40 civil societies and international digital rights organisations, including Access Now, Human Rights Watch, Privacy International and others, have approached the ad-hoc UN committee on cybercrime requesting it reconsider some of the provisions of the draft treaty currently being considered by the member nations.
Global Picks We Are Reading
■ How a small US newspaper’s website became an AI-generated clickbait factory (Wired)
■ They wanted careers in tech. They’re stuck as TikTok moderators (Rest of World)
■ Why some cyber-attacks hit harder than others (BBC)
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