Paytm is in the process of acquiring the e-commerce startup Bitsila, even as its subsidiary, Paytm Payments Bank, faces challenges following regulatory actions by the Reserve Bank of India. The deal is nearing completion and is expected to be finalized in the coming week, according to a report by Money control. 

Bitsila, established in 2020 by Dasharatham Bitla and Sooryah Pokkali, operates as a seller-side platform facilitating transactions on the Open Network for Digital Commerce (ONDC) in Bengaluru. 

Paytm, led by Vijay Shekhar Sharma, is already a buyer app on the ONDC. This acquisition aims to enhance Paytm’s presence within the ONDC ecosystem, extending its reach. 

The troubles for Paytm arose when the Reserve Bank of India directed its subsidiary, Paytm Payments Bank, to halt accepting new deposits after February 29. The RBI cited ‘persistent non-compliance’ as the reason for this action. It’s important to note that the regulatory action is specifically against Paytm Payments Bank, and the Paytm app itself remains unaffected. 

RBI Deputy Governor Swaminathan J clarified in a media interaction after the Monetary Policy Committee meeting, stating, “Just one clarification, this particular action is against Paytm Payments Bank and not to be confused with Paytm App… App is not impacted by this action.” 

In response to the RBI’s clarification, a Paytm spokesperson assured users and merchant partners that the Paytm app continues to operate seamlessly, with services unaffected. The spokesperson emphasized the commitment to providing uninterrupted payment solutions and promoting financial inclusion across India. 

Despite the challenges faced by Paytm Payments Bank, the acquisition of Bitsila showcases Paytm’s continued efforts to strengthen its position and expand its services in the evolving digital commerce landscape.