RBI Says No Review Of Action Against Paytm Payments Bank

Governor Das noted that the RBI remained supportive of the fintech sector, however, it was also ‘committed to protect the interest of customers as well as ensure financial stability’

The regulator barred Paytm Payments Bank from accepting payments or top-ups in any customer accounts, wallets, FASTags, and other instruments after February 29, 2024

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The Reserve Bank of India said on Monday that it isn’t planning to conduct any review of action against Paytm Payments Bank (PPBL) and asserted that the regulator made the decision regarding the fintech major after a detailed assessment of the firm. 

RBI Governor, Shaktikanta Das, clarified that the bank is not going to do any review of the disciplinary action taken against PPBL, reported PTI. Addressing a press conference after the 606th meeting of the Central Board of Directors of the RBI, Das said, “At the moment let me say very clearly there is no review of this (PPBL) decision. If you are expecting a review of the decision, let me very clearly say there is (going to be) no review of the decision.”

Notably, the regulator barred Paytm Payments Bank, the business segment of fintech major, Paytm, from accepting payments or top-ups in any customer accounts, wallets, FASTags, and other instruments after February 29, 2024. Das added that the decision taken by RBI was taken after a detailed analysis. Finance Minister Nirmala Sitharaman addressed the meeting.

Das also noted that the RBI remained supportive of the fintech sector, however, it was also ‘committed to protect the interest of customers as well as ensure financial stability’. Regarding the action against the banking business of Paytm, the central bank stated that it gave the mandate due to regular non-compliance issues and an overall lack of transparency in the firm’s proceedings. 

While the central bank has barred PPBL from accepting deposits/top-ups, it has permitted credit of interest, cashbacks, or refunds, even after the February 29 deadline.

Earlier on March 11, 2022, the central bank also restricted PPBL from taking on new customers, effective immediately. The regulator is now expected to release a set of FAQs (Frequently Asked Questions) soon on the Paytm issue in the week.