Paytm Faces Scrutiny Over Alleged FEMA Violations

Shares of One97 Communications, Paytm's parent company, plummeted after the Enforcement Directorate sent a notice alleging violations of FEMA rules concerning investment transactions. The violations are linked to two subsidiaries, Little Internet and Nearbuy, acquired by Paytm in 2017, but the claims pertain to a period before they were owned by Paytm.

Shares of One97 Communications, the parent firm of fintech giant Paytm, experienced a significant decline of over 4% following a notice from the Enforcement Directorate (ED). The notice alleges that the company and its subsidiaries violated FEMA rules concerning investment transactions.

The stock price on the National Stock Exchange (NSE) dropped 4.39% to Rs 683.55, while on the BSE, it decreased by 4.37% to Rs 685. This took place amidst a broader market slump with the BSE Sensex declining 271.22 points and the NSE Nifty dropping 93.60 points.

Paytm clarified that the alleged violations, involving over Rs 611 crore, are linked to its subsidiaries Little Internet and Nearbuy, concerning a period before Paytm's acquisition of these companies. The fintech firm is actively working to address the issue in compliance with relevant regulations, ensuring no disruption to its services.

(With inputs from agencies.)