RBI Gives Paytm A Second Chance, Extends Deadline For Stopping Transactions To March 15

The Reserve Bank of India (RBI) has granted an extension to Paytm Payments Bank Ltd. (PPBL), allowing them to continue deposits, credit transactions, and top-ups in customer accounts, wallets, and FASTags until March 15. This decision, made in consideration of customer interests, particularly those of merchants, follows the RBI's previous directive to cease such transactions after February 29. The extension aims to provide customers, including merchants, with additional time to arrange alternative solutions, aligning with broader public interests.

The RBI emphasized the importance of ensuring a smooth withdrawal process for customer deposits held with partner banks through the 'sweep-in sweep-out' mechanism, without causing any inconvenience to the depositors. This decision comes as part of the RBI's efforts to address ongoing non-compliance issues and significant supervisory concerns regarding PPBL, indicating the need for further supervisory measures.

In conjunction with the extension, the RBI has issued a set of Frequently Asked Questions (FAQs) to assist PPBL customers and the general public, offering clarity on the matter.