RBI Bars Paytm Payments Bank From Accepting Deposits, Wallets, and FASTags After Feb 29

The Reserve Bank of India (RBI) has barred Paytm Payments Bank from accepting deposits or top-ups in any customer account, prepaid instruments, wallets, and FASTags, among others, after February 29. The RBI’s action against Paytm Payments Bank Ltd (PPBL) follows a comprehensive system audit report and subsequent compliance validation report by external auditors.

The reports revealed persistent non-compliance and continued material supervisory concerns in the bank, warranting further supervisory action, the RBI said in a statement. 

“Withdrawal or utilization of balances by its customers from their accounts, including savings bank accounts, current accounts, prepaid instruments, FASTags, National Common Mobility Cards, etc., are to be permitted without any restrictions, up to their available balance,” the statement said. “No other banking services, other than those referred to in (ii) above, like fund transfers (irrespective of the name and nature of services like AEPS, IMPS, etc.), BBPOU, and UPI facility should be provided by the bank after February 29, 2024,” it added.

The Reserve Bank further stated 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. “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,” the RBI statement said.