Manju Agarwal resigns as Paytm Payments Bank independent director following regulatory intervention by RBI.

After the Reserve Bank of India (RBI) took regulatory action against Paytm Payments Bank, independent director Manju Agarwal reportedly resigned. The RBI's move on January 31 halted Paytm Payments Bank from acquiring new customers and mandated the cessation of key banking services starting February 29. According to CNBC-TV18, Agarwal, a board member since May 2021, promptly resigned on February 1.

RBI Governor Shaktikanta Das emphasized the bank's efforts to minimize customer inconvenience, stating they afford entities like Paytm adequate time for compliance before resorting to regulatory measures. He announced plans to release a set of FAQs addressing fintech-related queries to reassure customers, highlighting the RBI's preference for constructive engagement over punitive action.

Governor Das underscored the RBI's stance of intervening only when entities fail to comply with regulations, affirming the institution's commitment to responsible regulation. Meanwhile, reports indicated that Paytm founder Vijay Shekhar Sharma held discussions with RBI officials regarding the regulatory measures targeting the company's payments bank unit. Sharma reportedly sought clarification on regulatory concerns and requested an extension of the February 29 deadline. However, no concrete resolutions emerged from the meeting.

Following the RBI's Monetary Policy Committee (MPC) meeting, Paytm shares plummeted by 10%, triggering the lower circuit. The regulatory intervention caused a substantial decline in Paytm's stock value, with a more than 41% decrease since January 31, falling from Rs 761 to Rs 447.10 per share.

In summary, regulatory action by the RBI against Paytm Payments Bank prompted the resignation of an independent director and sparked discussions between company officials and regulatory authorities. Despite efforts to address concerns and seek extensions, uncertainty persists regarding the future trajectory of the company amid the ongoing regulatory scrutiny.