Paytm in Trouble? ED Accuses Company of ₹611 Crore Foreign Exchange Violation
New Delhi: The Enforcement Directorate (ED) has issued a notice to Paytm and its subsidiaries, accusing them of violating foreign exchange laws amounting to ₹611 crore under the Foreign Exchange Management Act (FEMA).
New Delhi: The Enforcement Directorate (ED) has issued a notice to Paytm and its subsidiaries, accusing them of violating foreign exchange laws amounting to ₹611 crore under the Foreign Exchange Management Act (FEMA).
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Allegations Against Paytm
The ED alleges that Paytm failed to comply with FEMA regulations while making an investment in Singapore and did not inform the Reserve Bank of India (RBI) about the transaction, as required by law. The investigation also found:
- Foreign Direct Investment (FDI) violations related to pricing rules set by the RBI.
- Paytm’s subsidiary Little Internet received FDI without following the pricing guidelines.
- Another unit, Nearbuy India, failed to report its foreign investment within the required timeframe.
Also Read: Ola Electric Lays Off Over 1,000 Employees Amid Rising Losses
Paytm’s Response
A Paytm spokesperson stated that the company is working towards resolving the matter in compliance with legal and regulatory norms. “We remain committed to upholding the highest standards of governance and compliance,” the spokesperson added.
Impact on Paytm Services & Stock Performance
Despite the ED notice, Paytm assured users that its services remain fully operational. Meanwhile, Paytm shares saw a 2% gain on Monday, recovering from an initial drop to close higher at ₹698.45.
This notice comes at a time when Paytm is already under regulatory scrutiny. The company is still awaiting RBI approval for a payment aggregator licence, and in January 2024, the RBI restricted Paytm Payments Bank from accepting new deposits due to supervisory concerns.
