Vijay Shekhar Sharma has stepped down as chairman of Paytm Payments Bank after the bank reconstituted the board.
According to the One 97 Communications Ltd (OCL), the parent firm of Paytm said that Vijay Shekhar Sharma has stepped down as part-time non-executive chairman and board member to enable the transition.
The development has come after the Reserve Bank of India (RBI) asked National Payments Corporation of India (NPCI) to examine use of UPI channel to allow Paytm App to continue operations and facilitate migration of @paytm handles to 4-5 banks.
In a BSE filing, the company said that the PPBL has reconstituted the Board with the appointment of Central Bank of India's former Chairman Srinivasan Sridhar, retired IAS officers Debendranath Sarangi and Rajni Sekhri Sibal, and Bank of Baroda's former Executive Director Ashok Kumar Garg.
PPBL's future business will be led by a reconstituted Board by One 97 Communications Ltd (OCL), after the RBI ban on the bank operations from March 15. They recently joined as Independent Directors.
"OCL withdraws its nominee from the Paytm Payments Bank Board and Vijay Shekhar Sharma steps down as part-time, non-executive Chairman and Board member," it said in the filing.
The company said that it supports PPBL’s move of opting for a board with only Independent and Executive Directors by removing its nominee.
"The company has been separately informed that Vijay Shekhar Sharma has also resigned from the Board of Paytm Payments Bank to enable this transition. PPBL has informed us that they will commence the process of appointing a new Chairman,” said the company in its filing.
This significant development came as the central bank extended, by 15 days to March 15, the deadline after which Paytm Payments Bank Ltd is barred from accepting deposits.
RBI bares Paytm Payments Bank Ltd (PPBL) from further deposits or credit transactions
Last month, the RBI barred Paytm Payments Bank Ltd (PPBL) from further deposits or credit transactions or top ups in any customer accounts, prepaid instruments, wallets, FASTags, NCMC cards, etc., other than any interest, cashbacks, or refunds which may be credited anytime.
RBI's action against Paytm was taken after a Comprehensive System Audit report and subsequent compliance validation report of the external auditors revealed persistent non-compliances and continued material supervisory concerns in the bank, warranting further supervisory action.
The Nodal Accounts of One97 Communications Ltd and Paytm Payments Services Ltd. are to be terminated at the earliest, according to the order.
With inputs from agencies
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