The Reserve Bank of India (RBI) had imposed restrictions on new customer onboarding may not have a substantial impact on Paytm Payments Bank. However, analysts believe that it will affect Paytm’s plan to convert the payment bank license to a small bank license. They also said the transaction volumes of Paytm may not be much impacted as the fintech firm has already onboarded a huge customer base onto the payments bank.
The new customers can sign up on the Paytm application, but they will have to limit transactions to linking their UPI handle or third-party payment instruments. Because as per the curbs imposed by RBI, Paytm is restricted from opening new Paytm Bank wallets, saving or current accounts, which will impact their ability to attract new payments and transactions.
Since Paytm has been incorporated in May 2017, it is the third time it is facing action from the Reserve Bank of India. The central bank has second time imposed restrictions on Paytm for opening new accounts.
According to Paytm, its existing customers will not face any disruption in services and they can continue to access all banking and payment services without any issues. The customers using Paytm UPI, Paytm FASTag, and Paytm Wallet will continue to access all facilities including debit cards and net banking.
