📢 BREAKING: RBI BANS PayTM to run UPI facility, among others ❌ Read on 👇
You won’t be able to transact using the PayTm wallet w.e.f. 1st March, 2024.
[1] Why this ban?
The RBI had directed PayTm Payments Bank to stop onboarding new customers w.e.f. 11th March, 2022.
Comprehensive systems audit report and subsequent compliance validation report of external auditors revealed persistent non-compliances and continued material supervisory concerns in the bank.
Thus, the RBI Ban has the following implications:
[2] Implications
🔸 No further deposits or credit transactions or top ups shall be allowed in any customer accounts, prepaid instruments, wallets, FASTags, NCMC cards, etc. after February 29, 2024.
🔸 Withdrawal or utilisation of balances by its customers are to be permitted without any restrictions, up to their available balance.
🔸 No other banking services Like fund transfers, BBPOU and UPI facility should be provided by the bank after February 29, 2024.
🔸 The Nodal Accounts of One97 Communications Ltd and Paytm Payments Services Ltd. are to be terminated at the earliest, in any case not later than February 29, 2024.
Those having any balance on PayTm wallet may redeem / transfer it asap.
[3] Impact on business model in simple words
We opened the PayTm app for making UPI payments and incidentally booked, movie tickets, flight tickets, etc.
Our UPI also provided PayTm with the intelligence based on which they could send you personalised offers like loans etc.
The app open rate will come down significantly and users may explore other apps like PhonePe and GooglePay for similar services.
This will be a big blow to PayTm for sure. What do you think?
Disclaimer: Not an investment advice. Please do your own research before taking an investment decision.
Source: RBI Press Release
