The Reserve Bank of India (RBI) has cancelled the licence of Paytm Payments Bank and said it will move ahead with winding up the bank through legal process. The decision follows long-standing regulatory concerns over compliance and operations.
The RBI said the bank had repeatedly failed to meet required norms and its functioning was not in line with banking rules. Because of these issues, the central bank said continuing operations was no longer appropriate and ordered closure proceedings.
Paytm Payments Bank has already been under restrictions for a long time. It was first stopped from adding new customers, and later faced limits on deposits and account activity.
For customers, the RBI has assured that their money is safe. The bank has been told to repay all deposits during the winding-up process, and it is expected to have enough funds to do so.
The bigger concern for users is what happens to everyday services like wallets and payments. Paytm has clarified that its main app will continue to work. Services such as UPI payments, QR code scanning, mobile recharges, and payment systems used by merchants are expected to remain active.
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