Paytm Shares in Focus: Fintech Arm Paytm Money Settled Case with SEBI

On February 14, 2025, Paytm shares are on investors’ radar after Paytm Money, the financial technology division of One97 Communications (Paytm), settled a case with the Securities and Exchange Board of India (SEBI) by paying a sum of ₹45.50 lakh.

The case originated from alleged breaches of SEBI’s technical glitch guidelines, which were outlined in a circular dated November 25, 2022. The settlement came after Paytm Money submitted an application in September of the previous year, seeking to resolve the matter without admitting or denying the facts and conclusions related to the alleged violations.

SEBI’s adjudicating officer, Asha Shetty, confirmed the settlement in an order issued on Thursday, noting that the proceedings against the company were concluded in accordance with settlement regulations.

SEBI said in the order, “Pursuant to the meeting with the Internal Committee of SEBI on October 17, 2024, in terms of the Settlement Regulations, Noticee vide letter dated October 29, 2024, proposed Revised Settlement Terms. The High Powered Advisory Committee (hereinafter referred to as “HPAC”) in its meeting held on November 18, 2024, considered the settlement terms proposed and recommended that the case may be settled upon payment of ₹45,50,000/- (Rupees Forty-Five Lakh Fifty Thousand Only) by the Noticee as settlement amount towards the settlement terms.”

SEBI’s Investigation into Paytm Money

SEBI’s investigation focused on Paytm Money’s adherence to technical standards, such as the timely generation of alerts for critical assets. A show-cause notice (SCN) issued on July 24, 2024, accused the company of not meeting the required 70% threshold for alert generation.

Additionally, SEBI raised concerns about Paytm Money’s inability to provide documentary evidence regarding peak load observations, its failure to link all critical systems to a log analytics application, and the lack of a live disaster recovery drill for the period between April and September 2023.

After Paytm Money submitted its settlement application, the company revised its terms, which were subsequently approved by SEBI’s high-powered advisory committee. With the settlement payment now made, the case has been officially closed.

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