RBI's big crackdown on Paytm bans the payments bank from adding new customers

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Paytm Payment Bank: Online payment service giant Paytm has received a major blow from the Reserve Bank of India (RBI). On Wednesday, the company providing digital payment and financial services has been banned from adding new customers. That means now no new customer can join with PPBL. The central bank said that this decision is being implemented with immediate effect.

Deposit-topup will not be accepted

Along with banning new customers in Paytm Payment Bank, RBI has announced another order that Paytm Payment Bank will not accept deposits/top-ups in any customer account, wallet and fastag after 29 February 2024.

Bank customers will be allowed to withdraw or use increased amount from their accounts including Savings Account, Current Account, Prepaid Instruments, Fasteg, National Common Mobility Card without any restriction. So RBI has clarified that savings bank account, current account and FASTag etc. can be rock-talked without withdrawing or using the deposit amount beforehand. RBI has taken this action against Paytm Payment Bank under Section 35A of Banking Regulation Act-1949.

Why did RBI take action on Paytm?

In connection with the action taken by the Reserve Bank on Paytm Payment Bank, it has been said that, following an audit report and a report by external auditors, non-compliance and material supervisory concerns have been exposed in Paytm's banking services. Amidst all this, this decision has been taken and under the order, along with the ban on adding new customers, transactions in the accounts of existing customers have also been suspended from 29 February 2024 onwards.

The impact can be seen on Paytm's shares

The effect of this decision of the Reserve Bank can be seen on Thursday on the shares of Paytm. It is worth mentioning that, even before this, the company's shares had seen a huge decline of up to 20 percent in the previous days. The reason behind which is showing the plan to reduce small postpaid loans by Paytm Payment Bank.

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