Praveen Kumar | New Delhi | April 16, 2025
In a move that underscores both accountability and visionary leadership, Paytm founder and CEO Vijay Shekhar Sharma has voluntarily surrendered ₹492 crore worth of unvested ESOPs, marking a significant gesture amid ongoing regulatory scrutiny by SEBI.
As per a regulatory filing by One 97 Communications, the parent company of Paytm, Sharma has forfeited 2.1 crore unvested stock options granted under the 2019 Employee Stock Option Scheme. The company confirmed that these options have now been cancelled and returned to the ESOP pool, demonstrating a high level of transparency and ethical leadership from the fintech pioneer.
One-Time Hit for Long-Term Gain
This decision will result in a one-time, non-cash ESOP expense of ₹492 crore in Q4 FY25, but will effectively lower future ESOP costs, setting the stage for leaner, more sustainable financial planning in the years ahead.
SEBI’s Watchful Eye
SEBI’s focus centered around the grant of ESOPs post-IPO—a move not permissible for promoters under current regulations. Although Sharma was classified only as an employee during Paytm’s 2021 IPO, SEBI flagged past shareholding patterns and pre-IPO restructuring, hinting he should have been identified as a promoter.
Prior to the IPO, Sharma transferred shares to a family trust to reduce his direct stake to below 10%, shifting 30.97 million shares and bringing his ownership from 14.7% to 9.1%, a step seen by some as a strategic compliance maneuver.
This regulatory investigation also follows concerns raised by the RBI, particularly around Paytm Payments Bank, adding to the intensity of scrutiny. Earlier this year, eight senior Paytm executives settled related issues with SEBI for ₹3.32 crore.
Navigating the Storm & Staying on Mission
Despite these headwinds, Paytm has been boldly reshaping its operations, trimming its workforce, offloading non-core assets, and sharpening its focus on high-growth areas like payments, merchant services, lending, wealth management, and insurance distribution.
In Q3 FY25, the company narrowed its net loss by 6% to ₹208.5 crore despite a 36% YoY revenue dip, indicating resilience amid a challenging regulatory and operational landscape.
Meanwhile, Paytm’s founder remains steadfast in his optimism
Strategic Refocus & Market Optimism
Even as UPI market share slipped from 10% to under 7%, the company is redirecting capital and talent toward high-margin verticals, cutting back on entertainment-related arms like Paytm Insider, and channeling resources into financial services.
This renewed clarity of vision appears to be resonating with investors — Paytm’s stock rose 2.97% today, closing at ₹864.50 on the BSE.
A Defining Moment of Reinvention
In many ways, Vijay Shekhar Sharma’s decision to return ₹492 crore worth of ESOPs is not just about compliance — it’s about taking ownership, building trust, and signaling a new chapter for Paytm. The fintech giant is doubling down on its mission to empower millions through financial inclusion, and is now positioned to emerge leaner, stronger, and more focused than ever.
The message is clear: challenges don’t define great companies — their response to them does. Entrepreneur Bulletin
