RBI extends Paytm Payments Bank transaction curb deadline to 15 March

The central bank said the extension aims to accommodate the needs of the payments bank’s consumers and merchants who may need more time to make alternative arrangements, emphasizing that the move was in the public’s best interest.

The RBI on 31 January directed Paytm Payments Bank to stop accepting deposits or top-ups in customer accounts, wallets, FASTags and other instruments after 29 February citing large scale non-compliance of regulations and supervisory concerns.

“No further deposits or credit transactions or top ups shall be allowed in any customer accounts, prepaid instruments, wallets, FASTags, National Common Mobility Cards, etc. after 15 March (extended from the earlier stipulated timeline of 29 February), other than any interest, cashbacks, sweep in from partner banks or refunds which may be credited anytime,” RBI said on Friday.

Separately, RBI said on Friday that merchants or businesses accepting payments using a Paytm QR code, Paytm soundbox or Paytm PoS (point-of-sale) terminal can continue to use it even after 15 March if their receipt and transfer of funds is linked to a bank account other than Paytm Payments Bank.

However, the deadline to close nodal accounts of One97 Communications and Paytm Payments Services maintained by Paytm Payments Bank has not been extended.

One97 Communications Ltd held a 49% stake in Paytm Payments Bank as of 31 March 2023. Paytm Payments Services is its subsidiary.

Nodal accounts serve as an intermediary between customers, merchants, and financial entities like payment aggregators and gateways, holding customer payments before settling them with the merchants.

The RBI has reiterated that there were no restrictions on customers looking to withdraw or utilize balances from their accounts.

“It is also directed that withdrawals up to their available balance should be facilitated by the bank from all accounts and wallets, excluding the ones that are frozen or lien marked by law enforcement or judicial authorities,” it said.

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Published: 16 Feb 2024, 05:40 PM IST