On Wednesday, the Reserve Bank of India prohibited Paytm Payments Bank Ltd from accepting new deposits and conducting credit transactions.
Effects of Restrictions on Paytm Payments Bank Services: What’s the Impact on You?
The Reserve Bank of India has implemented stringent measures against Paytm Payments Bank, resulting in the suspension of several services. Explore the implications of this action on the account holders of the payment bank.
The Reserve Bank of India (RBI) has taken action against Paytm Payments Bank Limited (PPBL), starting from February 29, which restricts the acceptance of deposits or top-ups in any customer account, including wallets and FASTags.
The Reserve Bank of India (RBI) has highlighted ongoing instances of non-compliance and sustained material supervisory concerns, prompting apprehensions regarding the operational integrity of Paytm Payments Bank.
How will this impact account holders of PPBL?
Deposit and top-up restrictions: Starting from February 29, 2024, PPBL is prohibited from receiving additional deposits or enabling top-ups in any customer accounts, including prepaid instruments, wallets, FASTags, NCMC cards, etc.
Special provisions for interest and refunds: Despite the imposed restrictions, the RBI permits exceptions, allowing the crediting of interest, cashbacks, or refunds at any given time.
Withdrawal and balance utilization: PPBL customers maintain the freedom to withdraw funds or use balances from their accounts without any limitations. This encompasses savings bank accounts, current accounts, prepaid instruments, FASTags, National Common Mobility Cards, etc., up to the extent of their available balance.
There are no limitations on UPI services; nevertheless, as of February 29, 2024, PPBL is constrained from providing supplementary banking services beyond withdrawals and account utilization. This entails the cessation of services such as fund transfers (including AEPS, IMPS, etc.), BBPOU, and UPI facilities.
Schedule for account adjustments: All pipeline transactions and nodal accounts associated with transactions initiated on or before February 29, 2024, must be resolved by March 15, 2024. No additional transactions will be allowed beyond this settlement deadline.
Nodal account closure: The Nodal Accounts linked to One97 Communications Ltd and Paytm Payments Services Ltd., in connection with PPBL, must be closed promptly, with the deadline set no later than February 29, 2024.