New Delhi: Vijay Shekhar Sharma, a known figure in Indias fintech industry has experienced both triumphs and controversies throughout his career.
Sharma founded Paytm, which stands for 'pay through mobile' initially focusing on recharges. The introduction of wallet services in 2011 was a milestone but the real breakthrough came during the 2016 demonetization period. Sharma positioned demonetization as the "most audacious decision in Indias financial history " leading to a surge in Paytm usage as cash became scarce.
In 2018 Paytm received a $300 million investment from Berkshire Hathaway led by Warren Buffett himself further solidifying its position in the market.
However controversies arose due to Paytms investments from Chinese sources, particularly Alibaba Group. Concerns were raised about its association with China when it was discovered that Antfin, an Alibaba group firm held a stake in Paytm. To address these concerns and reshape the ownership structure Vijay Shekhar Sharma executed a series of transactions in August 2023. This resulted in him acquiring a stake in Antfin and reducing their ownership stake, in Paytm.
Despite its beginnings Paytm encountered various challenges after going public.
The stock of the company, which made its debut in November 2021 through Indias ever public offering had a difficult start in the market and struggled to recover. Paytm was further affected by interventions from the Reserve Bank of India (RBI) including restrictions on Paytm Payments Bank and penalties for not complying with provisions.
In a setback Warren Buffets Berkshire Hathaway sold its investment in Paytm at a substantial loss in November 2023. Currently SAIF III Mauritius Company Limited is the direct shareholder in Paytm followed by Resilient Asset Management BV owned by Vijay Shekhar Sharma.
The RBI played a role in dealing with regulatory challenges faced by Paytm, such as restrictions on opening new accounts and wallets for Paytm Payments Bank. The regulator imposed penalties for non compliance issues ranging from submitting false information to cybersecurity shortcomings.
Vijay Shekhar Sharmas journey, from establishing a fintech company to dealing with controversies highlights the volatile nature of the industry and the challenges that key players face in todays evolving financial landscape.
—Input from Agencies