Paytm Payments Bank has been given extra time by the Reserve Bank of India to wind down its operations, whereas its father or mother firm has signed on a new banking partner aiming to hold a few of its well-liked merchandise operating and survive its current crisis. The RBI in January ordered Paytm Payments Bank, an affiliate of One 97 Communications (OCL) to cease accepting any new deposits in its accounts, or wallets, from February 29. The RBI prolonged the deadline to March 15 on Friday.
“The company (Paytm) has shifted its nodal account to Axis Bank (by opening an escrow account) to continue seamless merchant settlements as before,” Paytm mentioned in a launch.
Paytm QR codes, soundbox and card machines will continue to work as earlier than, even past March 15, the corporate added.
The motion in opposition to Paytm Payments Bank was triggered by what the RBI officers described as persistent non-compliance with laws. Earlier this week, the ED started wanting into particulars of abroad transactions on the platform.
RBI mentioned the deadline extension was to enable prospects, together with retailers, “a little more time” to make various preparations.
“No further deposits or credit transactions or top ups shall be allowed in any customer accounts, prepaid instruments, wallets, FASTags, National Common Mobility Cards, etc after March 15, 2024,” it mentioned.
Separately, the RBI additionally issued an in depth set of buyer clarifications.
The regulator mentioned prospects can withdraw or use funds from their Paytm Payments Bank accounts and wallets till the time these funds are exhausted however they can’t add any contemporary funds after March 15.
Customers who obtain their salaries or different transfers together with authorities subsidies into these accounts have to make alternate preparations by mid-March.
Merchants utilizing Paytm’s QR codes for accepting funds can continue to achieve this if these QR codes are linked to accounts aside from these held by Paytm Payments Bank.
The financial institution has almost a fifth share of India’s toll collections by means of a product known as FASTag. The RBI mentioned these FASTags can’t be recharged or topped up after March 15.
Non-executive chairman of Paytm Payments Bank Vijay Shekhar Sharma has met with RBI officers and the finance minister looking for to foyer in opposition to the crackdown, however RBI Governor Shaktikanta Das mentioned on Monday that there can be no evaluate of its determination.
(With Reuters inputs)
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