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RBI orders halt on Paytm Payments bank transactions: How will customers be affected?

The Reserve Bank of India (RBI) has directed Paytm Payments Bank to cease all deposits and credit transactions after February 29, 2024. This action stems from persistent non-compliances and ongoing supervisory concerns within the bank, raising questions about the impact on its customers.

Starting from the specified date, Paytm Payments Bank customers will face restrictions on several key transactions. No further deposits, credit transactions, or top-ups will be allowed in customer accounts, prepaid instruments, wallets, FASTags, or National Common Mobility Cards.

However, customers can still withdraw funds from their accounts, but certain services, including fund transfers and UPI facilities, will no longer be available.

The RBI’s intervention targets Paytm Payments Bank, an affiliate of the publicly-listed entity One 97 Communications. The bank, holding a 49% stake in Paytm Payments Bank, has been found non-compliant with regulatory standards and poses material supervisory concerns.

The central bank’s order extends to halting all deposits and top-ups in customer accounts, prepaid instruments, wallets, FASTags, and more.

Users can continue using the PayTM app and the UPI channel without any restrictions. It’s crucial to note that the PayTM app is owned by the parent company and not directly associated with PayTM Payments Bank.

Feb 01,2024

Source: Economic Times

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