Site icon Global Business Review Magazine

Investors in India’s Paytm have no access to payments bank data

Investors in India’s Paytm do not have access to customer data of its payments bank, CEO Vijay Shekhar Sharma said in an interview. This seems to be seeking to allay concerns over reports of user data being leaked to Chinese firms. Paytm is backed by China’s Alibaba Group Holding and its affiliate Ant Group.

The Reserve Bank of India barred Paytm Payments Bank from taking on new customers. They ordered a comprehensive audit of its IT systems, citing “material” supervisory concerns observed in the bank. Paytm has denied a news report from Bloomberg that said earlier on Monday RBI found Paytm Payments Bank’s servers were sharing information with China-based entities. Sharma said that no investor had access to the company’s customer data, and the country’s central bank had raised no concerns related to data storage or access.

Sharma also stated that there is no access of any bank customer data to any person, of any nationality. RBI has (in its observations) not mentioned anything in relation to investors. Paytm Payments Bank, which facilitates transactions on mobile commerce platform Paytm, has over 300 million wallets and 60 million bank accounts. Paytm is one of India’s most popular digital payments services. Shares of Paytm slumped 13% after RBI’s move, with Macquarie Research analysts saying they expect a significant impact on Paytm’s brand and customer loyalty. 

The RBI action is the latest setback for Paytm. This had a flop stock market debut of its $2.5 bln IPO in November. Its shares are down almost 70% from the issue price. Sharma stated that they are confident of addressing RBI’s concerns at the earliest. The RBI has ordered a comprehensive audit of Paytm Payment Bank’s IT systems. One of the Paytm spokesperson said that its payments bank data resides within the country.

Exit mobile version