RBI bans Paytm Payments Bank: In a major decision affecting thousands of Paytm subscribers, the Reserve Bank of India (RBI) on Wednesday barred Paytm Payments Bank Ltd from accepting deposits or top-ups in any customer account, prepaid instruments, wallets, and FASTags, among others after February 29, 2024.
In a statement, the RBI said its action against Paytm Payments Bank Ltd (PPBL) follows a comprehensive system audit report and subsequent compliance validation report of the external auditors. “These reports revealed persistent non-compliances and continued material supervisory concerns in the bank, warranting further supervisory action,” the RBI said in the statement.
“No further deposits or credit transactions or top ups shall be allowed in any customer accounts, prepaid instruments, wallets, FASTags, NCMC cards, etc. after February 29, 2024, other than any interest, cashbacks, or refunds which may be credited anytime,” it said.
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RBI bans Paytm Payments Bank.
The central bank further said withdrawal or utilisation of balances by its customers from their accounts including savings bank accounts, current accounts, prepaid instruments, FASTags, National Common Mobility Cards are to be permitted without any restrictions, up to their available balance.
“No other banking services like fund transfers (irrespective of name and nature of services like AEPS, IMPS, etc.), BBPOU and UPI facility should be provided by the bank after February 29, 2024,” the statement added. Adding more, the RBI said, “Settlement of all pipeline transactions and nodal accounts (in respect of all transactions initiated on or before February 29, 2024) shall be completed by March 15, 2024 and no further transactions shall be permitted thereafter.”
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The RBI further mentioned that the Nodal Accounts of One97 Communications Ltd and Paytm Payments Services Ltd. are to be terminated at the earliest, in any case not later than February 29, 2024. The RBI in March 2022 had directed PPBL to stop onboarding new customers with immediate effect.
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