Paytm Payments Bank Independent Director Manju Agarwal Resigns

Paytm Payments Bank Ltd (PPBL) announced on Monday that its independent director, Manju Agarwal, has resigned from the board due to personal reasons. The resignation comes a day after the Reserve Bank of India (RBI) issued an order to PPBL to stop accepting deposits or top-ups in customer accounts, wallets, FASTags, and other instruments after February 29.

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RBI's Action Against PPBL

The RBI's decision to restrict PPBL's operations was a result of the bank's persistent non-compliance with regulatory guidelines. Despite repeated nudges from the central bank, PPBL failed to address the concerns raised by the RBI.

In June 2018, the RBI had prohibited PPBL from opening any new accounts or wallets due to supervisory concerns. This restriction was lifted in December 2018, but it appears that PPBL continued to flout the regulations.

PPBL's Response

In response to the RBI's order, PPBL informed the stock exchange that Ms. Manju Agarwal had resigned from the board on February 1, 2024, due to personal commitments. The PPBL board noted her resignation on February 6, 2024.

PPBL also revealed that its other independent director, Shinjini Kumar, had resigned from the board with effect from February 1, 2024. However, the bank has not responded to media queries regarding the resignations and the RBI's action.

The resignations of two independent directors from PPBL's board and the RBI's restrictions on the bank's operations raise concerns about the bank's governance and compliance practices. It remains to be seen how PPBL will address these issues and restore the confidence of its customers and regulators.