In the wake of the Reserve Bank of India’s (RBI) recent directives restricting Paytm Payments Bank from accepting new deposits or facilitating credit transactions after February 29, the financial institution has moved swiftly to reassure its customers that their funds are secure.
In an email and text message sent to its customer base, Paytm Payments Bank emphasized that the RBI’s directive does not impact the existing balances of its clients. The communication stated, ‘Your money is safe with the Bank,’ and highlighted that while customers would be unable to add or deposit money into their accounts or wallets after February 29, there are no restrictions on the withdrawal of existing balances.
The RBI, in its recent announcement, specified that Paytm Payments Bank is prohibited from accepting deposits, offering credit services, or facilitating fund transfers from March onwards. The directive extends to various financial instruments such as customer accounts, prepaid instruments, wallets, FASTags, NCMC cards, etc. No further deposits, credit transactions, or top-ups will be permitted after the specified date, except for interest, cashbacks, or refunds that may be credited at any time.
This development follows the RBI’s instruction in March 2022, urging Paytm Payments Bank to cease the addition of new customers. Subsequently, Paytm witnessed a significant market downturn, with its stock plummeting to a six-week low of ₹609, leading to a 20% decrease in value, approximately erasing $1.2 billion from the company’s market capitalization.
Addressing the financial impact, Paytm expressed anticipation of a ‘worst-case scenario’ resulting in an annual earnings impact ranging between ₹300 crore to ₹500 crore due to the RBI’s order. The company affirmed its commitment to taking immediate steps to comply with the RBI’s directives, expressing confidence in continuing its trajectory to enhance profitability.
For further assistance or inquiries, customers were directed to reach out to Paytm Payments Bank via the 24×7 help section on the app. Paytm’s management assured its stakeholders of ongoing efforts to navigate the challenges posed by the regulatory measures and maintain the bank’s financial stability.
