paytm payments bank RBI Action

What Happen to Paytm Payment bank

Let us discuss that

Persistent non-compliances and ongoing material supervisory concerns within the bank forced RBI to ban Paytm Payment bank

What happened to Paytm Payment bank

As per the report the accounts at the bank were created without proper identification.

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This may be potentially a money laundering case

ED involvement

The case is now transferred to ED for further investigation

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If any illegal activities found ED may ban the Paytm bank completely

RBI Involvement

RBI has certain mandates for all the Payment banks that operate in India

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RBI found that hundreds of thousands of accounts at Paytm Payment bank are not following its mandates

RBI Action

The payment bank has been barred by RBI from engaging in any further activities that involve accepting deposits or top-ups in any customer account, prepaid instruments, FASTags, wallets, etc till the report came.

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What Paytm Bank is saying

Paytm is denied the irregularity in bank,

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The bank has denied the money laundering allegations

However, it is found that multiple accounts at Paytm Payments Bank were linked to the same identification that transactions ran in to crores.

What next

ED will share its report by 29th February 2024

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If any irregularity found, RBI will ban Paytm Payment bank.

It is not clear if Paytm App will work after that.

Impact on other payment banks

RBI is also scanning other fintech firms

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Fintechs that operate in the unsecured loan segment and act as intermediaries between customers and lenders are under the radar.

Impact on Customer

This action on Paytm Payment bank may not have much impact on custormers

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90% of Paytm's UPI users have accounts linked with other banks

What next to Customers

This crisis is not like other banking crisis like yes bank crisis

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Customers can withdraw their amount and deposit in other banks or use the amount.

Though there is nothing to worry about your  current deposits, it is advisable to stay away from the bank for till all is clear

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