Shares of Paytm gained 5 percent on February 6 after it was locked in a lower circuit for three straight sessions following RBI’s restrictions on its payments bank business. RBI barred Paytm Payments bank from accepting new deposits and conducting credit transactions after February 29.
At 9.40 am, Paytm was trading at ₹466. On February 5, the stock of Paytm parent One97 Communications closed 10 per cent down. The shares have lost a massive 41 per cent now in the last four trading sessions from ₹761.4.
This comes as traders’ body Confederation of All India Traders (CAIT) issued an advisory urging businesses to shift to alternative payment applications.
“The RBI has imposed certain restrictions, prompting CAIT to recommend that users take proactive measures to protect their funds and ensure uninterrupted financial transactions. Large number of small traders, vendors, hawkers and women are making payments through Paytm and, as such, RBI restrictions on Paytm could lead to financial disruptions for these people,” CAIT noted.
Meanwhile, Paytm founder and CEO Vijay Shekhar Sharma reassured employees that there will be no layoffs at the company as it is still engaging with the Reserve Bank of India (RBI).
“We are not completely sure of things… Like what exactly went wrong. But we will figure out everything soon. We will reach out to the RBI to see what can be done,” he told told Paytm employees.
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