RBI Limits Paytm Payments Bank’s Functions, Highlighting Compliance Concerns

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RBI Limits Paytm Payments Bank's Functions, Highlighting Compliance Concerns Timesnews24.in

The Central Bank of India (RBI) has taken a substantial measure by restraining Paytm Payments Bank Ltd from receiving deposits, facilitating credit transactions, or supporting top-ups in customer accounts or linked prepaid tools, such as wallets and FASTags, post-February 29.

Nevertheless, customers can still leverage balances in their accounts, comprising savings and current, “freely (and) up to their available” threshold, according to the RBI directive.

The central bank has also concluded the nodal accounts of Paytm’s parent entity, One97 Communications Ltd., and Paytm Payments Bank Ltd.

RBI Limits Paytm Payments Bank's Functions, Highlighting Compliance Concerns Timesnews24.in

The RBI’s determination stems from “persistent non-compliance and ongoing material supervisory apprehensions in the bank,” identified following a thorough examination of its systems by external entities.

As of now, neither the corporation nor its originator/CEO, Vijay Shekhar Sharma, has provided a reaction.

The Paytm application will persist in regular functionality, excluding attributes associated with the Paytm Bank, which will remain operative until February 29 or until the accessible balance is depleted.

This move tracks a directive from March 2022 instructing PBBL to halt enrolling new patrons “with immediate effect.”

RBI Limits Paytm Payments Bank's Functions, Highlighting Compliance Concerns Timesnews24.in

It is crucial to acknowledge that the RBI’s intervention specifically targets the banking operations of Paytm. Patrons can still deploy Paytm as a digital payment alternative if their account is associated with an external bank.

In December, One97 Communications executed budgetary measures by automating specific processes through Artificial Intelligence (AI), leading to the dismissal of numerous staff members across diverse sectors.

RBI Limits Paytm Payments Bank's Functions, Highlighting Compliance Concerns Timesnews24.in

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