Paytm issued a statement on Wednesday, February 14th, clarifying that its subsidiary, Paytm Payments Bank Limited, does not engage in outward foreign remittances. This comes in response to reports alleging that the Enforcement Directorate (ED) had initiated a probe into potential foreign exchange management act (FEMA) violations by the payments bank.
Key Points
- Paytm emphasized that Paytm Payments Bank does not undertake outward foreign remittances.
- The company reiterated its cooperation with authorities, stating it continues to provide all requested information, documents, and explanations.
- This clarification follows reports of the ED seeking details on past overseas transactions conducted by Paytm Payments Bank.
- Paytm’s share price witnessed a significant decline to a record low of INR 342.4 on the BSE on February 14th.
Further Context
- The ED reportedly initiated a preliminary examination into Paytm Payments Bank based on potential FEMA violations.
- The nature of the alleged violations and specific details of the investigation remain unclear.
- Paytm’s clarification aims to alleviate concerns among investors and stakeholders regarding the ongoing probe.
Possible Future Developments
- The ED may continue its investigation and potentially escalate it into a full-fledged probe depending on their findings.
- Paytm might face penalties or sanctions if the investigation uncovers any wrongdoing.
- The outcome of the investigation could further impact Paytm’s share price and overall business operations.
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