SoftBank Group Corp has sold a 2.17% stake in Paytm, reducing its stake to under 3%, as shown in an exchange filing. This move comes amid broader regulatory scrutiny and operational adjustments within Paytm, including the discontinuation of various inter-company agreements with its payments bank unit, Paytm Payments Bank (PPBL). The decision to sever business ties and reduce dependencies between Paytm and PPBL aims to comply with regulatory demands for a clearer distinction between payment firms and their banking units. This is part of a larger trend of fintech companies facing increased regulatory oversight, particularly concerning compliance with laws and KYC norms. The Reserve Bank of India (RBI) has set a March 15 deadline for Paytm Payments Bank to end its operations, highlighting the regulatory challenges facing the company.