Shortly before the central bank issued sanctions that caused the company’s share price to plummet by more than 42% in less than three days, SoftBank Group liquidated a sizable portion of its holding in India’s Paytm. The development was reported by Bloomberg, which cited Navneet Govil, the CFO and executive managing partner of the Vision Fund.
Govil claimed that SoftBank has noticed growing unpredictability in India’s regulatory environment in addition to the licence status of Paytm Payments Bank, the fintech company’s banking affiliate.
After Paytm went public in India in November 2021, SoftBank’s ownership in the fintech company dropped to approximately 5% in January. What SoftBank intends to do with the leftover shares is unknown.
Since the Reserve Bank of India shut down the majority of Paytm’s banking operations on January 31, users have been forced to move to other platforms, which has put the company in hot water.
Competitor apps like Google Pay and PhonePe are apparently seeing double-digit growth in downloads, while Paytm experienced a 32% decline in the first week of February compared to the last week of January.
Following a less than impressive year, SoftBank turned things around in the December quarter, reporting US$6.3 billion in net income.
