Paytm has reportedly gained approval from an Indian government panel for a key $6m investment. According to Reuters, this panel deals with Chinese-related financing. One97 Communications Limited is the parent company of Paytm and trades under the PAYTM.BO ticker on the Bombay Stock Exchange.
Troubled Paytm Gets Green Light From Panel For Investment In Core Subsidiary
Reuters stated that the approval still requires the go-ahead from India’s finance ministry. If given, it will enable one of the fintech’s main segments, Paytm Payment Services, to restore normal operations. This nucleus made up a quarter of the company’s consolidated revenue in its previous financial year.
Indian regulators reined in the company’s Paytm Payments Bank unit due to ongoing compliance problems. This consequently caused a stock crisis.
The review panel, which includes representatives from the foreign, home, finance and industries ministries, previously stalled this investment approval due to concerns about the 9.88% stake owned by China’s Ant Group.
Don’t miss out the latest news, subscribe to LeapRate’s newsletter
India has been taking a closer look at Chinese enterprises since the China-India 2020 border conflict. Should the investment receive the all-clear, Paytm will be eligible to apply for a payment aggregator licence from the central bank. Reuters quoted an unidentified Paytm spokesperson who said that the company will not comment on market speculation, adding:
We will continue to make disclosures in compliance with our obligations under the SEBI Regulations, and will inform the exchanges when there is any new material information to share.
PAYTM stock ended Tuesday 9 July 2024 trading at 2.17% in the red.
