In a relief to Paytm Payment Bank’s (PPB) merchants and customers, the Reserve Bank of India (RBI) has extended the deadline for the bank to stop accepting fresh deposits in its accounts and wallets by 15 days.
In a notification on Friday, RBI has now said that no further deposits, credit transactions or top ups shall be allowed in any customer accounts, prepaid instruments, wallets, FASTags, National Common Mobility Cards after March 15, 2024. Earlier, RBI had set the deadline at February 29.
However after March 15, no banking services, other than fund transfers, Bharat Bill Payment Systems, and unified payments interface facility can be provided by the bank. “Settlement of all pipeline transactions in nodal accounts shall be completed by March 15, 2024 and no further transactions shall be permitted thereafter,” the notification said.
At the same time, Paytm announced on Friday that it has shifted its nodal account to Axis Bank by opening an escrow account to ensure seamless merchant settlements.
“This arrangement is expected to seamlessly replace the nodal account that One97 Communications was using with PPB. Paytm Payment Services Ltd (PPSL), OCL’s wholly owned subsidiary has already been using the Axis Bank services, since its inception,” the release said.
According to reports, PPB has around 40 million merchants on its platform. The payments bank has around 350 million e-wallets. Paytm’s customers have a deposit balance of around Rs 3,000-4,000 crore across wallets.
RBI also released a long list of frequently asked questions (FAQs) on Friday that gave details about the transactions that can be done through PPB in the coming days. It clarified that the payments bank must facilitate withdrawals from all accounts and wallets up to their available balance, excluding the ones that are frozen or lien marked by law Enforcement or judicial authorities.
“The bank shall facilitate a seamless withdrawal of customer deposits that are parked with partner banks under the automatic ‘sweep-in sweep-out’ facility without causing any inconvenience to such customers,” the notification said.
It also added that customers of the payments bank can continue to use, withdraw, and transfer funds from their account up to the available balance. But, they cannot transfer or deposit money into the account after the March 15 deadline. Further, customers will not be able to top-up or transfer money into the wallet or receive any credits, other than cashbacks, or refunds into wallet after the deadline.
Customers will also be able to make monthly payments like OTT subscription and electricity bills automatically from their payments bank accounts till there is balance available in the account. It also asked customers to take the help of business correspondents to withdraw money.
Further it said that merchants can continue to use Paytm quick response code, Paytm soundbox or point of sale terminal, as long as it is linked to any bank account. “We assure our users that the Paytm app, and our pioneering devices like Paytm QR, Soundbox, Card Machine will continue to work as always,” a spokesperson from Paytm said.