RBI, Reserve Bank of India, has imposed restrictions on Paytm Payments Bank operations from February 29th. According to the restrictions, Paytm is not allowed to onboard new customers into Payments Bank. They will not be allowed perform any debit or credit transactions after the said date. Paytm Payments Bank has also been barred from allowing customers to add or withdraw money from their wallets.
RBI has barred Paytm from conducting any kind of UPI payments or handing loans. The central reserve bank has banned it from doing any operations on FASTag, prepaid instruments, postpaid, ATM withdrawals and any banking operations like funds transfer. If you’re already a customer, you can withdraw money from savings and current accounts before the date. No extra charges will be imposed.
For exisitng customers, Wallet won’t be operable expect for cashbacks and any rewards offered. RBI has taken this stringent action on Paytm Payments Bank due to repeated offence of “persistent non-compliances and continued material supervisory concerns in the bank, warranting further supervisory action” with audit requests. As this doesn’t bode well with the transparency in operations that RBI seek, such measures have been taken on Paytm.
Action against Paytm Payments Bank Ltd under Section 35A of the Banking Regulation Act, 1949https://t.co/bswaWHSxtk
— ReserveBankOfIndia (@RBI) January 31, 2024
Well, while the restrictions are on Paytm Payment Bank accounts, UPI transactions through Paytm from other bank accounts will still be allowed. This move will be pushing Paytm and their parent company One97 communications to seek reversal of these restrictions before the said date. But for now, RBI will withhold to their decision and hence, it might be advised to observe caution in banking operations with Paytm in coming days.
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