Paytm Refutes Reports On Lending Partners Invoking Loan Guarantees Due To Repayment Default
Paytm will continue to collaborate with multiple banks and non-banking financial companies for a diversified lending partnership network, it said.
Paytm has refuted media reports on its lending partners invoking loan guarantees due to repayment defaults. The company acts as a distributor of loans and does not provide a first-loss default guarantee or other loan guarantees to its lending partners, it said.
"Paytm acts as a distributor of loans and does not provide a First Loss Default Guarantee (FLDG) or other loan guarantees to lending partners. Therefore, the article’s claims about invoking loan guarantees due to repayment defaults by our partnered lenders are inaccurate," it said in an exchange filing on Thursday.
Paytm will continue to collaborate with multiple banks and non-banking financial companies for a diversified lending partnership network, it said.
"Our personal loan distribution business was not disrupted and continued to scale effectively. The merchant loan business resumed at the end of March 2024, following the completion of the '@paytm' handle transition," it said.
The response comes after some media reports claimed that Aditya Birla Finance Ltd. and some other lending partners invoked loan guarantees that Paytm provided to them in lieu of repayment defaults from customers.
The company also clarified reports on recent exits at the company.
It still has a senior leadership structure with over 50 senior vice presidents and all the recent changes are aligned with a pre-approved succession plan that has been discussed with the board, it said.
"Leaders within this structure oversee operations and reviews across business, product, and technology," the statement read.
As a part of the annual performance assessment, Paytm will continue to evaluate its talent pool periodically in the context of future plans. And this could lead to the transition of some roles, it said.
The response comes after reports suggested that Paytm's Chief Business Officers of UPI and offline payments, Ajay Vikram Singh and Bipin Kaul, respectively, stepped down.
Their resignations added to the list of employees who have either left Paytm or transitioned to some other roles within the company post the Reserve Bank of India's clampdown on Paytm Payments Bank.
Paytm's chief operating officer and president, Bhavesh Gupta, too, resigned on May 4. While he would be relieved from the services at the at the close of business hours on May 31, he will continue as an advisor in the chief executive officer's office after May 31, the company said in an exchange filing.
