Paytm Payments Bank’s CEO and MD, Surinder Chawla Announces Resignation

Surinder Chawla Paytm Payments Bank's CEO

Three points you will get to know in this article:

  • Chawla will leave his position by June 26 unless agreed otherwise.
  • CEO and MD leaving for personal reasons and better career prospects.
  • Paytm Payments Bank has not announced Chawla’s replacement yet.

CEO Resignation and Departure Details

Paytm Payments Bank Limited (PPBL) is facing regulatory challenges and will be parting ways with its CEO and managing director Surinder Chawla by June 26. According to a regulatory filing by On97 Communications (OCL), the parent company of the fintech major, Chawla submitted his resignation on Monday, April 8 and will be stepping down from his role by June 26, unless mutually agreed upon otherwise.

Leadership Succession Uncertainty

According to the paperwork, the CEO and MD who are leaving mentioned personal reasons and a quest for better career opportunities as the reasons for their departure. However, the company hasn’t disclosed yet who will step into Chawla’s shoes.

Chawla became part of the payments bank team in February last year. With a background as a Chartered Accountant, he’s been in the banking industry for almost thirty years. During this time, he’s had stints with major players like HDFC Bank, RBL Bank, Standard Chartered, ABN AMRO Bank, and Citibank. In addition to serving as the CEO, Chawla also held the position of an independent director on the board of PPBL.

Board Restructuring and Independent Directors

Following his departure, the board of the payments bank has been restructured to include five independent directors, one of whom is an independent chairperson. None of the directors are nominees from Paytm.

This decision was made as Paytm and PPBL mutually agreed to terminate several inter-company agreements on March 1. Prior to the official separation of both entities on February 26, Paytm founder and CEO Vijay Shekhar Sharma resigned from the Paytm payments bank board.

Sharma had been appointed as the part-time non-executive chairman and board member of the payments bank. Prior to Sharma, independent directors Manju Agarwal and Shinjini Kumar had resigned from the board of the payments bank.

RBI Directive and Operational Cease

On January 31, the Reserve Bank of India (RBI) directed Paytm Payments Bank Limited (PPBL) to cease accepting deposits, credit transactions, or top-ups in any customer accounts (including prepaid instruments, wallets, FASTags, and NCMC cards) after March 15.

This occurred shortly after the central bank identified deficiencies in the internal detection mechanisms, reports of suspicious transactions, and a significantly high volume of user complaints at PPBL.

Paytm Payments Bank Limited (PPBL) faces regulatory obstacles and will part ways with CEO Surinder Chawla by June 26 due to personal reasons and career advancement. The leadership transition raises uncertainty regarding Chawla’s successor. The board restructuring includes five independent directors after the termination of inter-company agreements with Paytm. The Reserve Bank of India’s directive to halt transactions following internal deficiencies and complaints further complicates PPBL’s operational challenges. These recent developments underscore a period of significant transformation and regulatory scrutiny for the fintech major.

Neha Kamath

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