Union minister Rajeev Chandrasekhar has highlighted the importance of regulatory compliance for fintech firms in the wake of the Reserve Bank of India’s action against Paytm Payments Bank. The minister emphasized that no company, regardless of its size or origin, can escape the consequences of non-compliance with the law.
In an interview with news agency PTI, Chandrasekhar addressed the Paytm Payments Bank issue, describing it as a case where an ambitious entrepreneur failed to grasp the necessity of adhering to regulatory requirements. He emphasized that the central bank’s action against the payment gateway serves as a reminder that all companies must abide by the laws of the land.
The RBI’s recent order granted Paytm Payments Bank an extension until March 15 to halt deposits, prohibiting further transactions in customer accounts after this date. Chandrasekhar stressed that this development should serve as a wake-up call for fintech entrepreneurs, urging them to prioritize compliance with regulations.
The minister noted that entrepreneurs and startups often become so focused on building their businesses that they overlook the rules established by regulators. He described this as a “genetic flaw” among entrepreneurs, emphasizing the need for them to pay greater attention to regulatory compliance.
Chandrasekhar concluded by asserting that regulatory compliance is not optional for businesses, particularly in India, and that entrepreneurs must recognize and adhere to the rules that have been put in place by regulatory authorities. He refuted the notion that the RBI’s action has caused fear within the fintech industry, instead framing it as an opportunity for entrepreneurs to understand the importance of compliance with the law.
