RBI Imposes Restrictions on Paytm Payments Bank

RBI Imposes Restrictions on Paytm Payments Bank

VoM News Desk | January 31, 2024 | 08:02 PM IST | Breaking News | Follow on Google News

RBI Imposes Restrictions on Paytm Payments Bank

RBI Imposes Restrictions on Paytm Payments Bank

January 31, 2024:

The Reserve Bank of India (RBI) has implemented stringent restrictions on Paytm Payments Bank Ltd (PPBL), effective after February 29, 2024. The restrictions include a prohibition on accepting new deposits and conducting credit transactions, including top-ups, in customer accounts, wallets, and FASTags. This decision follows an extensive audit of Paytm’s banking systems by external auditors, revealing “persistent non-compliances and continued material supervisory concerns.”

Customers Retain Access to Existing Balances
Despite the restrictions, the RBI allows customers to utilize the existing balances in their savings and current accounts without any limitations. This measure aims to mitigate inconvenience for customers while the bank addresses regulatory concerns. Paytm Payments Bank must complete the settlement of all pipeline transactions and close the nodal accounts of its parent company, One97 Communications Ltd., and Paytm Payment Services Ltd., by March 15, 2024.

No Impact on Paytm’s UPI Services
Notably, the RBI’s directive does not impact Paytm’s Unified Payment Interface (UPI) services. Customers can continue using Paytm for digital payments as long as their accounts are linked to other banks. This distinction indicates the RBI’s targeted intervention, focusing on specific areas of concern rather than a comprehensive ban on all Paytm services.

One97 Communications’ Response
One97 Communications, Paytm’s parent company, has not officially commented on the RBI’s recent actions or outlined its plans to address the identified non-compliances. The company’s strategic response to these regulatory challenges remains unclear.

VoM News Desk

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