NEW DELHI: The Reserve Bank of India (RBI) will not review its measures taken against Paytm Payments Bank, Governor Shaktikanta Das said on Monday after a meeting of the central board of directors here.
He added that the decision was taken after a thorough assessment of the functioning of the bank. The apex bank on January 31 had banned PPBL from accepting deposits or top-ups in any customer account, wallet, FASTTags and other instruments after February 29 on account of persistent non-compliance with banking regulations and continued material supervisory concerns in the bank.
It instructed the termination of ‘nodal accounts’ affiliated with One97 Communications Ltd, which is parent company of Paytm brand and holds a 49% stake in Paytm Payments Bank Limited (PPBL). This move by the RBI reclassified One97 Communications as an associate rather than a subsidiary, signalling a major change in relationship between the two entities. Though interest credits, cashbacks, and refunds have been allowed to be continued without any restrictions.
“At the moment, let me say clearly there is no review of this decision. If you are expecting a review, let me very clearly say there is going to be no review of the decision,” Das told reporters on the sidelines of CBD meet.
However, the Governor reassured that the RBI will continue to support the fintech sector along with its commitment to safeguard the interest of customers. It is to be noted that the RBI will release a set of frequently asked questions (FAQs) with regard to Paytm next week.
It may be recalled that on March 11, 2022, the central bank had put a ban on PPBL to onboard new customers and directed it to appoint an IT audit firm to conduct a comprehensive System Audit.