Mumbai: Relief to customers, reserve Bank of India on Monday Rest deadline on most restrictions Was applied Paytm Payments banks from February 29 to March 15, including accepting new deposits. It also clarified that QR codes and soundboxes that are not linked to PPBL will continue to work even after mid-March.
However, RBI made it clear that withdrawal of these services is not possible for the payments bank. RBI clearly advised customers to apply for the new Fastag and National Common Mobility Card (NCMC) cards to be used in metros and buses if they are currently Paytm customers. It also said that people who are using PPBL savings accounts to receive subsidies, salaries or government benefits should open new bank accounts.

Shares of Paytm, which have been in decline for weeks following the RBI action, rose 5% as the market looked for life beyond PPBL for the parent company. Although RBI has taken a tough stance on PPBL and ensured that there is no disruption in the UPI payments sector, there will be challenges ahead. PPBL has issued around 45 lakh Fastags which will have to be exchanged with other banks. As per stringent KYC norms, customers cannot hold two Fastag accounts at the same time. PPBL is also the banker of 253 toll plazas for electronic collection and a new bank will have to replace it.
There won’t be much disruption for the millions of shopkeepers and cart vendors (3.5 crore as per RBI data) displaying the Paytm QR code. Sources said the number of merchants who linked their QR codes to Paytm Payments Bank was only in lakhs as most preferred their physical banks with ATMs rather than banks.
According to sources, Paytm has partnered with Axis Bank for its nodal account. Nodal accounts are where funds are held in escrow pending settlement and are a source of funds flowing into the bank. Even if PPBL does not receive fresh money from depositors, the nodal account will continue to receive settlement funds from the merchant acquisition business.
Although the RBI FAQs did not clearly mention whether the Paytm virtual payment address (VPA), used by crores of app users, would remain functional, the RBI deputy governor had said on February 8 that other handles UPI apps related to will remain operational. Work. According to bankers, the fact that merchant QR codes would work after March 15 was a sign that the @paytm handle would remain operational.