- The Reserve Bank of India (RBI) has directed Paytm Payments Bank to cease accepting deposits, providing credit services, and facilitating fund transfers from 29 February.
- Paytm Payments Bank is instructed to stop onboarding new customers immediately and settle all pipeline transactions initiated on or before 29 February by 15 March.
- RBI cites “persistent non-compliances and continued material supervisory concerns” as reasons for the regulatory action.
- Paytm Payments Bank, an independent subsidiary of One 97 Communications, is collaborating with RBI to address concerns and ensure compliance.
- One 97 Communications plans to “accelerate” its shift to other bank partners, terminating its working relationship with Paytm Payments Bank.
- The termination is expected to have a potential worst-case impact of $36.1 million to $60.2 million on annual EBITDA for One 97 Communications.
- The company reassures that its loan distribution, insurance distribution, and equity broking services will remain unaffected by the regulatory order.
India’s RBI orders Paytm Payments Bank to halt banking services by end of February
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