In a huge setback to fintech services provider Paytm, the Reserve Bank of India (RBI) restricted its payments bank subsidiary, Paytm Payments Bank Ltd (PPBL), from accepting new deposits or top-ups in its accounts or wallets beginning February 29. PPBL was forbidden from onboarding new clients in March 2022. The latest step came after an audit report indicated “persistent non-compliance and continued material supervisory concerns in the bank”.
The RBI has prohibited the Paytm subsidiary from accepting new deposits, top-ups, or credit transactions into its wallets or accounts beginning February 29. This also applies to its prepaid instruments like FASTags and National Common Mobility Cards (NCMC). Current clients, however, will be able to utilize their existing balances to access the services. According to Macquire Capital, the payments bank has more than 330 million wallet accounts from the parent business One97 Communication (OCL). In other words, transactional money is kept in the wallets of the payments bank.
