Paytm denies reports of lenders invoking loan guarantees as “factually incorrect”

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Fintech firm One97 Communications, which owns the Paytm brand, on Thursday (May 9) denied recent media reports suggesting issues with its lending business and termed it “factually incorrect.”

The company said it acts as a distributor of loans and does not provide a First Loss Default Guarantee (FLDG) or other loan guarantees to lending partners.

Further, Paytm said, “Therefore, the claims about invoking loan guarantees due to repayment defaults by our partnered lenders are inaccurate. We continue to collaborate with multiple banks and NBFCs, ensuring a diversified lending partnership network while strictly adhering to risk and compliance.”

“Our Personal Loans distribution business was not disrupted and continued to scale effectively. The Merchant Loan business resumed at the end of March 2024 following the completion of the “@paytm” handle transition,” the company noted.

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Regarding recent employee exits, Paytm said, “We wish to emphasise that the company has a robust senior leadership structure with over 50 Senior Vice Presidents, supported by a strong management and governance framework.”

“Leaders within this structure oversee operations and reviews across business, product, and technology. All recent changes at Paytm have been aligned with pre-approved succession plans discussed with the Board in previous financial years,” Paytm pointed out.

“As part of our annual performance assessment, we will continue to evaluate our talent bench periodically within the context of our future plans, which will result in the transition of some roles and employees,” the company added.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow