The Reserve Bank of India has revoked the licence of Paytm Payments Bank, prompting concern among millions of users about the safety of their money.
However, the RBI has urged customers not to panic, assuring that the bank has adequate funds to return all deposits. It also clarified that services such as UPI, wallet, and other payment systems under Paytm will continue to function normally. The action was taken due to non-compliance with regulatory norms, but essential services for users will remain unaffected. As a result of the decision, Paytm Payments Bank will no longer be able to accept fresh deposits.
RBI’s position
The RBI reiterated that adherence to regulatory guidelines is non-negotiable, and the licence revocation followed repeated violations. It assured the public that customer funds are completely safe, with sufficient reserves available to repay all deposits. The licence was withdrawn effective from the close of business on April 24, and the central bank confirmed that the bank has enough liquidity to meet all its liabilities.
In its statement, the RBI said the management of the bank was “prejudicial to the interest of depositors as well as public interest,” and allowing it to continue operations would serve no meaningful purpose.
What Paytm said
One 97 Communications, which operates Paytm services, clarified that it does not have a direct operational link with Paytm Payments Bank and has already written off its investment in the entity. The company added that its core services will continue without disruption even after the bank’s shutdown.
It also confirmed that services like Paytm Gold and Paytm Money remain unaffected by the RBI’s decision and will continue to operate as usual.
Notably, Paytm Payments Bank has faced regulatory scrutiny in the past as well. In 2022, the RBI had barred the bank from onboarding new customers.