Starting from February 29, 2024, Paytm Payments Bank Limited (PPBL) is restricted from accepting new deposits, credit transactions, or top-ups in various customer accounts, including prepaid instruments, wallets, and FASTags. Despite this limitation, the bank assures its customers that their existing balances are secure and can be withdrawn without any constraints.
In correspondence sent via email and text message, PPBL informed its customers about the prohibition on new deposits and credit transactions after the specified date. The bank emphasized that customers are free to withdraw funds from their current balances without any restrictions.
This regulatory action by the central bank is a result of a comprehensive system audit report and compliance validation conducted by external auditors. Alongside the restrictions on new transactions, PPBL is required to discontinue certain banking services, such as fund transfers and UPI facilities. Additionally, the nodal accounts of One97 Communications Ltd and Paytm Payments Services Ltd. must be terminated by February 29, 2024.
The Reserve Bank of India (RBI) had previously instructed PPBL to halt the onboarding of new customers in March 2022. In line with the current directive, all pipeline transactions and nodal accounts initiated on or before February 29, 2024, need to be settled by March 15, 2024.
The RBI clarified that customers can freely withdraw or use their balances from accounts, including savings bank accounts, current accounts, prepaid instruments, FASTags, and National Common Mobility Cards, without any restrictions up to their available balance. However, the bank is no longer permitted to provide other banking services like fund transfers (including services like AEPS, IMPS, etc.), BBPOU, and UPI facilities after February 29, 2024. The termination of Nodal Accounts for One97 Communications Ltd and Paytm Payments Services Ltd. is mandatory and should be executed at the earliest, no later than February 29, 2024, according to the RBI’s directives.
