RBI Releases FAQs on Paytm Payments Bank Operations After March 15

Mumbai: The Reserve Bank of India (RBI) on Friday issued a list of frequently asked questions (FAQs) on Paytm Payments Bank for the convenience of the customers of the fintech giant which has been banned from onboarding new customers. The RBI in a press statement announced extending the deadline for Paytm Payments Bank to wind down operations by 15 days to March 15 from its earlier deadline of February 29.

In a 30 point FAQ, the central bank said that customers will be able to use, withdraw, or transfer funds from both current and savings accounts up to the available balance even after March 15. The use of Paytm Payments Bank debit card will also be allowed but only for these purposes.

However, the central bank has clarified that customers of Paytm Payments Bank won't be able to deposit money into their accounts (including salary accounts and direct benefit transfers) other than interest, cashback, sweep-in from partner banks, or refunds. Since no credit or deposit in Paytm accounts will be allowed after March 15, the central bank advised customers to make alternative arrangements through another bank, before the deadline.

On a question what will happen to the deposits maintained with partner banks through ‘sweep in/out’ arrangements, after March 15, 2024? The RBI said, "The existing deposits of Paytm Payments Bank customers maintained with partner banks can be brought back (sweep-in) to the accounts with Paytm Payments Bank, subject to the ceiling on balance prescribed for a Payments Bank (i.e. 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 Paytm Payments Bank will be allowed after March 15, 2024”.

Withdrawal or debit mandates (for electricity bills, OTT subscriptions, EMIs, etc) will continue to be executed till there is a balance in the account. But all these facilities will be stopped after March 15, 2024, the RBI said.

The RBI advised customers to approach Paytm Payments Bank or use its banking app to close their Paytm wallet and transfer their balance to an account maintained with another bank in the case of full KYC wallets. In the case of minimum KYC Wallets, users can use the available balance or request for a refund.

FASTags issued by Paytm Payments Bank can be used only upto the available balance. Adding money or top-ups won't be allowed after March 15. The same rules will be applicable to the National Common Mobility Card (NCMC) issued by Paytm Payments Bank.

The central bank last month banned Paytm Payments Bank from offering all forms of banking services including fund transfers via Unified Payments Interface, IMPS, Aadhaar-enabled payments, and bill payment transactions, effective February 29, 2024.

The listed fintech major will also not be allowed to accept deposits, credit transactions, or top-ups in any customer accounts, prepaid instruments, wallets, FASTags, National Common Mobility Cards (NCMC) other than any interest, cashback, or refunds.

( Source : Deccan Chronicle )
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