India’s ED Seeks Overseas Transaction Details from Paytm

India’s Enforcement Directorate (ED), tasked with combating financial crimes, is reportedly seeking information on overseas transactions from Paytm Payments Bank Limited (PPBL), a subsidiary of Paytm’s parent company, One 97 Communications. 

This move comes from a probe initiated by the ED earlier this month into One 97 Communications over suspected violations of foreign exchange regulations, as reported by Reuters. Both Paytm and the Enforcement Directorate have yet to respond to requests for comment.

Preliminary Examination Underway:

Government sources in New Delhi have characterized the scrutiny as a preliminary examination, suggesting that authorities are in the early stages of investigating potential infractions. 

The development follows the ED’s initial request for additional information from the Reserve Bank of India (RBI). It recently directed Paytm Payments Bank to scale back its operations by February 29 due to significant and persistent supervisory concerns.

Market Fallout and Regulatory Pressure on Paytm:

The regulatory intervention by the RBI has had significant repercussions for Paytm, with the company’s market value plummeting by nearly 55% since the central bank’s directive. 

The decline in market value has been accompanied by a sharp drop in Paytm’s share price, which fell by nearly 10% on Wednesday. 

These developments underscore Paytm’s mounting regulatory and market pressures in the aftermath of the ED probe and RBI’s supervisory actions.

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