The Enforcement Directorate (ED) was conducting searches on certain premises of One 97 Communications Ltd’s Paytm and payment solutions provider PayU, as per a Reuters report.
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Commenting on the matter, a Paytm spokesperson said, “as we have mentioned before, ED continues to seek information about certain merchants from various payment service providers, we have shared the required information.”
Clamping down on illegal loan apps flourishing outside the regular banking channels, a high-level meeting chaired last Thursday by Finance Minister Nirmala Sitharaman asked the Reserve Bank of India (RBI) to prepare a ‘whitelist’ of legal apps to be permitted in app stores, monitor money laundering through rented accounts, cancel dormant NBFC licenses and remove unregistered payment aggregators within a timeframe.
Earlier this month, the ED had raided several premises in Bengaluru, including those of Razorpay Pvt Ltd, Cashfree Payments, Paytm Payment Service and also entities controlled or operated by Chinese individuals. The crackdown comes in the wake of complaints against Chinese loan apps and were carried out under the provisions of the Prevention of Money Laundering Act, 2002.
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The RBI has been concerned about the proliferation of Chinese loan apps. FE
