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Paytm founder steps down as chairman at India's biggest fintech

Feb 27, 2024
Data: Capital IQ; Chart: Axios Visuals
Data: Capital IQ; Chart: Axios Visuals

Indian fintech Paytm revealed Monday that CEO and founder Vijay Shekhar Sharma will step down as non-executive chairman and board member.

Why it matters: It's the latest in an enormous change of fate for the business, which once attracted hefty valuations from investors including Berkshire Hathaway, SoftBank and Alibaba.

Follow the money: Those investors are now out or have significantly pared back their stakes.

  • Alibaba and affiliate Ant Financial initially paid over $500 million for a 40% stake in 2015. It sold off its entire stake by February 2023, amid rising China-India tensions.
  • Berkshire Hathaway initially acquired a stake in 2018, reportedly valuing Paytm at over $10 billion. It completed the exit of its stake in the company in November.
  • SoftBank revealed that it, too, had sold a majority stake in Paytm prior to the regulatory crackdown. Still, it booked a gross loss of $471 million on the company in the the final quarter of 2023.

By the numbers: Shares of One 97, the name Paytm trades under, have shed 59% in value over the past six months.

  • Valued at about 560 billion INR ($6.8 billion) in August, the business is now valued at 272 billion INR ($3.28 billion) on the National Stock Exchange of India.

Context: The change at the largest fintech in India comes amid a crackdown on financial services in that country.

  • The Reserve Bank of India cracked down on unsecured loans last year, in a move aimed at curbing consumer debt and delinquencies.
  • Paytm in particular has been barred from accepting new deposits in its customer accounts starting March 15, with the RBI citing "persistent non-compliance."
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