Business

Paytm To Sell Wallet Business; Jio Financial Shares Surge Amidst Talks Of Acquisition

Jio Financial Services witnessed a robust 14% surge, reaching a day’s high of ₹288.75 on the BSE. This spike followed reports indicating that One 97 Communications, the parent company of Paytm, is engaged in discussions with Jio Financial and HDFC Bank to potentially sell its wallet business.

The Hindu Business Line identified HDFC Bank and Jio Financial as leading contenders in the acquisition race for Paytm’s wallet business. Talks between Jio Financial and Paytm have reportedly been ongoing since November, while discussions with HDFC Bank commenced just before the Reserve Bank of India’s (RBI) ban on Paytm Payments Bank.

As part of a broader rescue strategy, Jio may propose acquiring Paytm Payments Bank, which has faced challenges since the RBI prohibited it from accepting deposits or credits. Paytm has encountered controversy, with authorities exploring the possibility of the platform being used for money laundering. Paytm, however, has vehemently denied these allegations, stating that neither the company nor its CEO is under investigation by the Enforcement Directorate. Paytm’s shares witnessed a 42% decline in just three days following the RBI directive.

Jio Financial, the owner of Jio Payments Bank, has recently revamped its operations to introduce digital savings accounts and facilitate bill payments. With a network of 2,400 business correspondents and the launch of debit cards, Jio has been actively implementing innovations such as the Jio Voicebox, enabling UPI on Jio phones, and introducing QR codes across its ecosystem.

In response to the crisis, Paytm CEO Vijay Shekhar Sharma assured employees during a virtual town hall that there is nothing to worry about. He expressed gratitude for the support received from various banks and pledged to investigate the situation. Despite uncertainties, Sharma emphasized the resilience of the Paytm family and the commitment to resolving the issues with the RBI.

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Malika Sahni

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