In a major action against Paytm Payments Bank (PPBL), Reserve Bank of India (RBI) had directed it to stop accepting deposits or top-ups in any customer accounts, wallets, FASTags and other instruments after March 15.
Paytm Payments Bank Crisis Timeline
Here is how the situation unfolded for Paytm Payments Bank (PPBL):
January 31, 2024: RBI directs Paytm to stop accepting deposits or top-ups in any customer accounts, wallets, FASTags and other instruments after February 29.
February 1: RBI introduces further restrictions on Paytm after a comprehensive system audit report and subsequent compliance validation report of the external auditors reveal alleged persistent non-compliances and continued material supervisory concerns in the bank, warranting further supervisory action.
February 4: Traders' body CAIT issues cautionary advisory to traders to switch from Paytm to other payment options for business-related transactions.
February 8: RBI Governor Shaktikanta Das says action against Paytm driven by 'lack of compliance'. RBI also says the regulatory action is against PPBL and the Paytm App will not be impacted by it.
February 9: Paytm sets up a group advisory committee headed by former Sebi chairman, M Damodaran, on compliance, and regulatory matters.
February 12: RBI Governor Das rules out any review of the central bank's action against PPBL, saying its decisions are well thought out.
February 15: Enforcement Directorate (ED) questions senior Paytm executives and asks for documents before it decides to launch a formal investigation.
February 16: The RBI gives 15 days more till March 15 to Paytm, extending its earlier deadline of February 29. Paytm shifts nodal account to Axis Bank to ensure continuity of transactions.
What Happens After March 15?
After March 15, PPBL customers will not be able to deposit money into their Paytm Payments Bank accounts.
No credits or deposits other than interest, cashback, sweep-in from partner banks or refunds are allowed to be credited. Customers are suggested to make alternative arrangements with another bank to avoid inconvenience.
The existing deposits of PPBL customers maintained with partner banks can be brought back (sweep-in) to the accounts with PPBL, subject to the ceiling on balance (Rs 2 lakh per individual customer at the end of day).
Such sweep-ins for the purpose of making available the balances for use or withdrawal by the customer will continue to be allowed. However, no fresh deposits with partner banks through PPBL will be allowed.
Salaries and pensions, too, will not be credited in PPBL accounts. Those customers paying EMIs or OTT subscriptions through PPBL also need to make alternative arrangements.
No further funding or top-ups will be allowed in the FASTags issued by Paytm Payments Bank.
For merchants who accept payments using Paytm QR code, Paytm soundbox, Paytm POS terminal linked to PPBL account or wallet, the RBI said they will not be able to avail the service after March 15, and should look for other alternatives.
Also Read: RBI FAQs For Paytm Payments Bank Customers
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