India's financial crime enforcement agency has issued a show cause notice to Paytm over alleged violations of the country's Foreign Exchange Management Act.

The notice relates to the acquisition of two companies, Little Internet Private Limited and Nearbuy India Private Limited, covering the period from 2015 to 2019.

Paytm has stated that the alleged violations occurred before these companies became its subsidiaries. The company maintains that the notice has no impact on its services for consumers and merchants. No further details about the specific allegations have been disclosed.

The notice comes at a time of increased regulatory scrutiny of digital payment firms in India.

Paytm has previously faced challenges related to compliance and operations, making the latest development a significant issue for the company as it continues to navigate the country's evolving financial regulations.