Updated February 12th, 2024 at 18:12 IST
RBI firm on decision against Paytm Payments Bank, no review expected
Governor Das stressed that there is currently no intention to review the directive issued to Paytm Payments Bank.
Reserve Bank of India Governor Shaktikanta Das has affirmed that there will be no reconsideration of the central bank's recent measures taken against Paytm Payments Bank (PPBL). The decision, he clarified, was made following a thorough evaluation of the bank's operations.
Speaking at a press conference after the 606th meeting of the Central Board of Directors of the Reserve Bank of India, Governor Das stressed that there is currently no intention to review the directive issued to PPBL. The statement comes in response to speculation regarding a potential reassessment of the situation.
Finance Minister Nirmala Sitharaman also addressed the meeting, underlining the importance of regulatory actions to maintain financial stability and protect consumer interests.
Governor Das reiterated the RBI's support for the fintech sector while underscoring the regulator's commitment to ensuring compliance and safeguarding the integrity of the financial system.
In response to the ongoing situation, the central bank is set to release a set of Frequently Asked Questions (FAQs) regarding the Paytm matter later this week.
The RBI's action against PPBL on January 31 mandated the bank to cease accepting deposits or top-ups in any customer accounts, wallets, FASTags, and other instruments after February 29. The move followed persistent non-compliances and supervisory concerns identified by the RBI.
Previously, in March 2022, the RBI had prohibited PPBL from onboarding new customers with immediate effect.
Under the recent directive, PPBL customers will still be able to withdraw or utilise balances from their accounts without restrictions, up to their available balance. However, the bank is prohibited from accepting new deposits or credit transactions after February 29.
Additionally, the RBI has instructed the termination of the 'nodal accounts' of One97 Communications Ltd., the parent company of Paytm.
While One97 Communications holds a 49 per cent stake in Paytm Payments Bank Limited, it categorises the bank as an associate rather than a subsidiary.
(With PTI inputs)
Published February 12th, 2024 at 18:12 IST