Paytm Payments Bank faces RBI action, can’t offer services after February 29

The Reserve Bank of India (RBI) has taken the choice to ban Paytm Payments Bank Ltd (PPBL) from accepting deposits or top-ups in any buyer account, pay as you go devices, wallets, FASTags, and extra after February 29, 2024. The motion by the RBI is a results of a complete system audit report and subsequent compliance validation report by exterior auditors, which recognized persistent non-compliances and ongoing materials supervisory issues on the financial institution.

In an announcement, the RBI stated that, as a result of findings, additional supervisory motion is critical, and from February 29, 2024, no new deposits, credit score transactions, or top-ups might be allowed in any buyer accounts, pay as you go devices, wallets, FASTags, NCMC playing cards, and so on. 

“No further deposits or credit transactions or top ups shall be allowed in any customer accounts, prepaid instruments, wallets, FASTags, NCMC cards, etc. after February 29, 2024, other than any interest, cashbacks, or refunds which may be credited anytime,” it stated.

The central financial institution clarified that prospects are permitted to withdraw or utilise balances from their accounts, together with financial savings financial institution accounts, present accounts, pay as you go devices, FASTags, and National Common Mobility Cards, with none restrictions, as much as their obtainable stability.

“Withdrawal or utilisation of balances by its customers from their accounts, including savings bank accounts, current accounts, prepaid instruments, FASTags, National Common Mobility Cards, etc. is permitted without any restrictions up to their available balance. 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. 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,” the RBI stated.

“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,” it added.

In March 2022, the RBI had beforehand directed PPBL to halt onboarding new prospects with fast impact.

(With PTI inputs)

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