RBI has barred Paytm Payments Bank from accepting deposits in any customer account from next month.

The Reserve Bank of India (RBI) on January 31 imposed restrictions on Paytm Payments Bank Limited (PPBL) following the system audit report and compliance verification report by external auditors.

Under Section 35A of the Banking Regulation Act, 1949, PPBL is barred from accepting deposits or top-up to any customer account, wallet or Fastag after February 29.

The audit report revealed persistent non-compliance and continuing material supervisory concerns at the bank, necessitating further supervisory action, RBI said in a statement.

No deposit or credit transaction or top-up will be allowed in any customer account, prepaid device, wallet, Fastag, NCMC card etc. after February 29, 2024, other than any interest, cashback or refund, if ever Can. Deposited. ,” it said.

"No other banking services such as fund transfer (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," the statement said.

RBI further said that the nodal accounts of One97 Communications and Paytm Payments Services Limited are to be terminated at the earliest, in any case not earlier than February 29, 2024.

However, the banking regulator said its customers will be allowed to withdraw or utilize balance from their accounts including savings bank accounts, current accounts, prepaid instruments, Fastag and National Common Mobility Cards without any restriction up to their available balance. in a statement.

"Settlement of all pipeline transactions and nodal accounts (in respect of all transactions initiated on or before February 29, 2024) will be completed by March 15, 2024 and no further transactions will be permitted thereafter," the central bank said. will be given." will go."

Earlier in March 2022, RBI had directed PPBL to stop onboarding new customers with immediate effect.

Reactions:

Commenting on the development, Gaurav Goyal, Director, Finocrate Technologies, said, “As of February 29, the Reserve Bank of India (RBI) has taken steps against Paytm Payments Bank Limited (PPBL), allowing it to receive its deposits or top up -Turning off has been prevented. Above. Capacity has been limited. Customer accounts, including wallets and Fastag. “The central bank has highlighted ongoing non-compliance and supervisory concerns, giving rise to apprehensions about the operational integrity of Paytm Payments Bank.”

"The RBI move primarily targets Paytm's banking operations, allowing customers to use Paytm for digital payments, as long as their account is linked to an external bank. Currently, the company There appears to be a negative development for Paytm, which will undoubtedly impact its existing customers. However, we should wait for the official statement from the company. This development may also impact the short to medium term stock price of Paytm (One 97 Communication). "Is expected," he said.