Paytm and Antfin: The Truth Behind the Chinese Stake Transfer Controversy

In what may turn out to be one of the most significant corporate governance controversies in India’s startup ecosystem, Paytm and its founder Vijay Shekhar Sharma (VSS) are facing serious questions following a viral LinkedIn post by Jayant Mundhra, a noted financial commentator, former Bain consultant, and author of Redemption of a Son. His revelations claim that the recent narrative around Chinese investor Ant Financial’s "exit" from Paytm is not just misleading—but possibly deceptive.

Has Paytm Misled Investors on Antfin’s Exit? The Truth Behind the Chinese Stake Transfer

According to Mundhra, the widely reported exit of Antfin from Paytm is a myth. Contrary to media reports, Antfin continues to hold effective control over 10.3% of Paytm shares through a Netherlands-based entity called Resilient Asset Management BV (RAM BV), owned by Vijay Shekhar Sharma on paper—but not in substance.

Timeline of the ‘Exit’ That Wasn’t 

Jayant Mundhra, who has published four deep-dive reports on this matter over two years, shared the following timeline:

• July 14, 2023: VSS registers RAM BV in the Netherlands.
• July 19, 2023: Two unknown directors are added to RAM BV’s board.
• Late July 2023: Ant Financial transfers 10.3% of Paytm shares to RAM BV, not for cash, but in exchange for Optionally Convertible Debentures (OCDs).

This transaction structure implies that Antfin has not sold its stake, but has merely parked it—with the right to reclaim it anytime through conversion of OCDs into equity in RAM BV.

What Are OCDs—and Why Should Investors Be Concerned?

In financial terms, OCDs are instruments that give the holder the right to convert debt into equity at a future date. In this case, Ant Financial holds OCDs against Paytm shares now owned by RAM BV.

This means:

• Antfin can convert the OCDs at any time, effectively regaining ownership of the 10.3% stake in Paytm.
• No fixed timeline or terms for this conversion have been disclosed publicly, raising serious transparency issues.
• Retail investors, regulators, and markets are unaware of the true extent of Antfin’s ongoing influence.

Mundhra's post states bluntly:

“Antfin has the right to convert the OCDs into a direct shareholding in RAM BV, which will give it back an indirect shareholding in Paytm, any damn moment!”

Why This Structure? Regulatory Bottlenecks

Jayant Mundhra argues that this arrangement was likely created to bypass regulatory roadblocks caused by Paytm’s significant Chinese ownership. Regulatory authorities such as RBI and IRDAI have consistently denied Paytm key licences and approvals, citing foreign shareholding concerns.

Rejected by Regulators:

• RBI rejected Paytm’s NBFC licence application.
• IRDAI blocked Paytm’s acquisition of Raheja QBE General Insurance.
• Paytm’s Payment Aggregator licence remains unapproved.
• Paytm Payments Bank collapsed earlier this year, nullifying ambitions for a small finance bank licence.

Mundhra suggests that this OCD arrangement was a workaround to present a “clean” ownership to regulators while retaining Chinese control through the back door.

The Critical Risk: Antfin’s Hidden Leverage

If Paytm succeeds in getting regulatory approvals under the garb of a “Chinese-free” cap table, Antfin can convert OCDs and reclaim its stake, legitimized by fresh approvals. Alternatively, Antfin can sell the OCDs to any buyer, including VSS, if Paytm’s valuation increases.

This flexibility makes the “exit” illusory, with investors and regulators left in the dark.

Key Questions for Paytm, Regulators, and Media

1. Why have the terms of the OCD agreement between VSS and Antfin never been disclosed to public shareholders?
2. Who are the other directors of RAM BV and what is their relationship with Ant Financial?
3. Has SEBI investigated this structure for transparency and disclosure violations?
4. Why has the Indian media not investigated this complex transaction in detail?

Investor Transparency or Regulatory Arbitrage?

Paytm’s structural opacity comes at a time when investor confidence is fragile and regulatory scrutiny is increasing. With the collapse of Paytm Payments Bank, continued licence denials, and ongoing capital challenges, corporate governance transparency is more critical than ever.

Mundhra’s exposé raises a larger concern for India’s startup ecosystem:

“If a publicly listed fintech giant can mask ownership through offshore vehicles and complex instruments, what message does this send to global investors and domestic regulators?”

Is This India’s Next Corporate Governance Scandal?

Jayant Mundhra’s deep-dive demands a full public explanation from Paytm and VSS. Investors deserve to know the true ownership and control structure of a company that has positioned itself as India’s fintech pioneer.

In light of these revelations, SEBI, RBI, and IRDAI must initiate a probe into the RAM BV structure and demand full disclosure. Equally, the media must re-examine Paytm’s ownership narrative with the rigour and independence that public markets demand.

At stake is not just Paytm’s credibility—but the trust of crores of Indian investors.

Disclaimer: This report is based on a viral LinkedIn post by Jayant Mundhra, Ex-Bain, Classplus, and author of Redemption of a Son. As of publishing, TICE has not received any official response or counterstatement from Paytm. This story will be updated as and when new information becomes available.