- The Reserve Bank of India imposes strict limits on Paytm, barring new deposits and credit transactions.
- The move follows the RBI's directive for Paytm Payments Bank to stop accepting new customer accounts due to non-compliance.
- The restrictions may affect Paytm's offline merchant and gateway businesses, impacting various banking services.
The Reserve Bank of India has imposed strict restrictions on Paytm's Payments Bank, preventing it from offering various banking services such as accepting new deposits and credit transactions.
This move comes after the central bank ordered Paytm Payments Bank to stop accepting new customer accounts due to non-compliance issues. The extent of the new restrictions is not yet clear, but it could have a significant impact on Paytm's offline merchant and gateway businesses.
The parent company, One97 Communications, owns a 49% stake in Paytm Payments Bank. The RBI has also directed the termination of nodal accounts associated with Paytm, which may require the company to move its businesses to other banks. However, customers will still be able to withdraw and use money from their accounts.
In 2022, Paytm Payments Bank faced penalties from RBI for breaking rules. The penalties were imposed because the company allowed data to be transferred to servers outside of India and failed to verify its customers correctly.
Edited by Shruti Thapa