INDIA’S Paytm and its payments bank unit have mutually agreed to discontinue various inter-company agreements in the process to reduce dependencies, the embattled payments firm said on Friday (Mar 1).

Paytm, formally known as One 97 Communications, did not specify what agreements were being terminated.

The payments bank agreed to simplify the shareholders’ agreement to “support (Paytm Payments Bank’s) governance, independent of its shareholders”, the company said.

Paytm CEO Vijay Shekhar Sharma owns a 51 per cent stake in Paytm Payments Bank while Paytm owns the rest.

The move came days after Sharma stepped down as non-executive chairman and board member of the payments bank unit, as part of a major overhaul that follows a central bank clampdown.

The Reserve Bank of India had asked Paytm Payments Bank to wind down operations by Mar 15 due to persistent compliance issues and supervisory concerns, triggering a meltdown in Paytm’s stock.

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The action against the unit followed concerns including inadequate customer identity checks and a lack of arms-length distance from parent company Paytm, sources previously told Reuters. REUTERS