Shares of Jio Financial Services rallied up to 14% to ₹288.75 on the Bombay Stock Exchange on Monday following reports that the Mukesh Ambani-owned non-banking financial company is in talks with One 97 Communications, the parent company of Paytm, to potentially acquire its wallet business.Both Jio Financial and private sector lender HDFC Bank have emerged as front runners to buy the mobile payments companys wallet operations. Paytms leadership team, led by CEO Vijay Shekhar Sharma, has apparently been engaging with Jio Financial on a possible deal since November. The proposed acquisition could be part of a larger bailout plan as Paytm faces an existential crisis after being barred by the RBI from accepting fresh deposits. There are concerns regulatory agencies suspect the entity may have been used for money laundering, though Paytm has strongly denied these allegations. Neither the company nor Sharma are officially under investigation for money laundering.Nonetheless, Paytm shares have plunged 42% over just three days following the central banks action. Jio Financials payments bank Jio Payments Bank, meanwhile, has been heavily investing in building out digital savings accounts, bill payments, debit cards and QR code infrastructure.According to reports, during a virtual town hall with Paytm Payments Bank employees, CEO Vijay Shekhar Sharma said there was no need to worry as many banks were ready to help. He added the company was not yet fully aware of what exactly prompted the RBI ban, but would seek clarity from regulators on a resolution.
