The Reserve Bank of India (RBI) has taken significant actions against Paytm Payments Bank Ltd (PPBL) under Section 35A of the Banking Regulation Act, 1949. Here’s what it means for Paytm users:
- Deposits and Top-Ups: As of February 29, 2024, no further deposits or credit transactions or top-ups will be allowed in any customer accounts, prepaid instruments, wallets, FASTags, NCMC cards, etc. However, interest, cashbacks, or refunds may still be credited.
- Withdrawals and Utilization: Paytm users can withdraw or utilize balances from their accounts, including savings bank accounts, current accounts, prepaid instruments, FASTags, and National Common Mobility Cards, without any restrictions, up to their available balance.
- Banking Services: After February 29, 2024, no other banking services (such as fund transfers, AEPS, IMPS, BBPOU, and UPI facility) will be provided by the bank.
- Nodal Accounts Termination: The Nodal Accounts of One97 Communications Ltd and Paytm Payments Services Ltd. will be terminated by February 29, 2024.
- Pipeline Transactions: The settlement of all pipeline transactions and nodal accounts (for transactions initiated on or before February 29, 2024) must be completed by March 15, 2024, and no further transactions will be permitted thereafter1.
In summary, while Paytm users can still access their existing balances, certain services will no longer be available through Paytm Payments Bank after the specified date. It’s essential for users to be aware of these changes and plan accordingly. 📅💰
The Reserve Bank of India (RBI) has imposed several sanctions on Paytm Payments Bank, affecting various services offered by the platform. Here’s a breakdown of what will work and what won’t:
- FASTags: FASTags issued by Paytm Payment Banks will continue working. Users can use existing balances in their FASTag wallet and via third-party banks after the nodal transfer happens.
- UPI on Paytm app: Paytm users can continue using the Paytm app and Paytm UPI without any restriction.
- Offline merchant network: Services like Paytm QR, Paytm Soundbox, and Paytm Card Machine for offline merchants will continue as usual, allowing onboarding of new offline merchants.
- User deposits safety: User deposits in savings accounts, Wallets, FASTags, and National Common Mobility Card (NCMC) accounts are not impacted. Customers can continue using existing balances.
- Online merchant services: The Payment Gateway business for online merchants will continue to offer payment solutions to existing merchants.
However, there are certain restrictions:
- Partnership with PPBL: The company will no longer work with Paytm Payments Bank Limited (PPBL) and will accelerate plans to move to partnerships with other banks.
- Onboarding of new customers: Paytm Payments Bank Limited (PPBL) will not be able to onboard new customers or open new accounts.
- Paytm app/wallet linked to Paytm Payments Banks: Paytm app/wallet linked to Paytm Payments Banks will stop working after February 29. Beneficiaries can continue to receive credits up to February 29, 2024. Thereafter, they can only withdraw or transfer funds from their wallet or account. No credits or top-ups into Paytm Payments Bank account or wallet are allowed from March 1, 2024.
- Financial Services (Loan, Insurance, Equity Broking): Other financial services such as loan distribution, insurance distribution, and equity broking are not directly related to the associate bank and are expected to be unaffected