RBI action on Paytm Payments Bank: Key details you must be aware of

As per the notification, Paytm Payments Bank will not be allowed to accept fresh deposits, undertake credit transactions, or top-ups in any customer accounts. This also includes prepaid instruments, wallets, FASTags, and NCMC cards, among others.

The RBI said the order would come into force after February 29, 2024.

Will customers receive interest on their balance?

Yes, interest, cashback, and refunds can be credited at any time.

Why did RBI impose restrictions?

The RBI’s action against Paytm Payments Bank was taken following reports of non-compliance and supervisory concerns.

The central bank said a Comprehensive System Audit report and subsequent compliance validation report by the external auditors revealed persistent non-compliance and continued material supervisory concerns in the bank, warranting further supervisory action.

Will customers be able to use their available balances?

As per the notification, customers can withdraw and utilise their balances in their accounts.

The RBI said utilisation of balances by its customers from their accounts, including savings bank accounts, current accounts, prepaid instruments, FASTags, National Common Mobility Cards, etc., will be permitted without any restrictions, up to their available balance.

Which other services are banned?

The central bank said no other banking services like fund transfers (irrespective of the name and nature of services like AEPS, IMPS, etc.), BBPOU, and UPI facilities should be provided by the bank after February 29, 2024.

This is in addition to the services allowed by the RBI.

Termination of nodal accounts

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, RBI said.