PayTM On The Verge Of Death. Will SEBI Take Responsibility Of Investors Loss As It Allowed A Loss Making Company To Launch IPO

Macquarie slashes PayTm target price by 57% to Rs 275, sees huge customer exodus

• Macquarie slashes target price by 57% to Rs 275, sees huge customer exodus
• Paytm Fighting For Survival, Says Macquarie After Downgrade
• RBI Governor Shaktikanta Das rules out review of action against Paytm Payments Bank
• Centre examining FDI flow from China in Paytm Payments Services
• Vijay Shekhar Sharma considered quitting Paytm Payments Bank board to avoid RBI impasse
• Vijay Shekhar Sharma’s Passport Must Be Confisticated as Government Must Learn From The Case Of Vijay Malaya & Neerav Modi

Inventiva as a investigative media house has been long urging SEBI & Its Chairman Madhabi Puri Buch to not allow any loss making startup company to launch its IPO but all the letters and request had been falling on the deaf ears.

These loss making startups are inflating their IPO valuation to almost 100X and passes their losses to the retail investors. The worst part is that most of these startups do not issue fresh shares sales, only the already existing investors sell their shares in the IPO along with the founders and both founders and investors makes money and public at large gets into losses.

Lets have a look at what has happened recently in PayTM

Paytm Payments Bank is considered a serial offender in RBI’s corridors. In 2018, it was barred from onboarding customers and the restrictions were removed a year after corrective actions. However in March 2022, the RBI once again barred the bank from onboarding new customers citing lapses in KYC.

The shares of Paytm have plunged 43 per cent since January 31. Its shares are trading near an all-time low of Rs 438.35 apiece. The sell-off started after the Reserve Bank of India (RBI) barred Paytm Payments Bank Ltd (PPBL) from accepting more deposits from February 29, owing to “persistent non-compliances”.

The order meant that PPBL would not be able to undertake any banking activity, including accepting deposits, credit transactions, wallet top-ups (not even form FASTags) and bill payments.

Later, on February 2, a report by Bloomberg stated that the RBI is also considering cancelling Paytm Payments Bank’s operating license as early as next month once the depositors are safeguarded.

The PPBL started its operations on May 23, 2017. It offered digital banking, including savings accounts, current accounts, fixed deposits with partner banks, and balance in wallets, UPI, and FASTag, among other services.
According to the rules of the payment banks, these cannot lend any money and can accept deposits only up to Rs 2,00,000.
Paytm Wallet also comes under the ambit of PPBL. According to RBI’s provisional data for December 2023, Paytm Wallet users carried out 247.2 million transactions worth over Rs 8,000 crore for the purchase of goods and services while 20.7 million transactions were carried out for transferring over Rs 5,900 crore.

The banking regulator had been frequently flagging off issues.
In 2018, the RBI temporarily halted the opening of new accounts in PPBL owing to violations in licensing conditions and non-compliance with Know-Your-Customer (KYC) norms. Later, in 2021, RBI said it had uncovered that PPBL submitted false information. It was fined Rs 1 crore.
On March 11, 2022, the RBI barred PPBL from onboarding new customers with immediate effect.

By October 2023, the RBI imposed a penalty of Rs 5.39 crore on PPBL for continued non-compliance with KYC norms.
Now, reports suggest that money laundering concerns and questionable dealings of hundreds of crores of rupees between popular wallet Paytm and its lesser-known banking arm had led RBI to clamp down on Vijay Shekhar Sharma-run entities.

Paytm Payments Bank has about 35 crore e-wallets. Of this, about 31 crore are dormant while only about 4 crore would be operative with either no balance or a small balance.

Money laundering concerns and questionable dealings of hundreds of crores of rupees between popular wallet Paytm and its lesser-known banking arm had led Reserve Bank of India to clamp down on tech poster boy Vijay Sekhar Sharma-run entities, sources said. The central bank has ordered Paytm Payments Bank Ltd (PPBL) to halt most of its business including taking further deposits, conducting credit transactions and carrying out top-ups on any customer accounts, prepaid instruments, wallets, and cards for paying road tolls after Feb 29 2024

According To One Report ED probing Paytm and Paytm Payments Bank over currency transactions

Enforcement Directorate is investigating if platforms run by One 97 Communications, the parent firm of Paytm, were involved in violations of foreign exchange rules, said a report on Monday. Two senior government sources said did not indicate what specific provisions of the Foreign Exchange Management Act (FEMA), which covers individual and corporate transfers overseas, were the subject of the investigation by ED.

In This current scenario it is very evident that Vijay Shekhar Sharma Might Run Out Of India to escape the investigation so government must confisticate Vijay Shekhar Sharma Passport so that he can not run out of country like Vijay Malaya & Neerav Modi.

In November 2021 Inventiva warned Its users against buying the PayTM IPO In 2023 After Making Huge Profits from PayTm IPO, Vijay Shekhar Sharma Also starting buy back of its shares as Paytm was planning a Paytm FPO

Seems RBI Action has Killed Paytm plans and also raised the questions on integrity and working of SEBI & Its Chairman