RBI punished Paytm Payments Bank 500 Cr Loss1????? Also The Paytm stock Is down???

New Delhi [India], February 1: Paytm Payments Bank Limited (“PPBL”), an associate of OCL (One 97 Communications Limited), has received RBI directions. Paytm Payments Bank is set to expand its existing relationships with leading third-party banks to distribute payments and financial services products.

OCL updated that it has been informed by its associate, PPBL, that the Reserve Bank of India (RBI) vide its Press Release dated January 31, 2024, has given it further directions under section 35A of the Banking Regulation Act, 1949.

The Paytm Payment Gateway business (online merchants) will continue to offer payment solutions to its existing merchants. OCL’s offline merchant payment network offerings like Paytm QR, Paytm Soundbox, Paytm Card Machine, will continue as usual, where it can onboard new offline merchants as well.

Depending on the nature of the resolution, the Company expects this action to have a worst case impact of Rs. 300 to 500 crores on its annual EBITDA going forward. However, the Company expects to continue on its trajectory to improve its profitability.

RBI Mentioned Five Main Points.

• No further deposits or credit transactions or top ups shall be allowed in any customer accounts, prepaid instruments, wallets, FASTags, NCMC cards, etc. after February 29, 2024, other than any interest, cashbacks, or refunds which may be credited anytime.
• Withdrawal or utilization of balances by its customers from their accounts including savings bank accounts, current accounts, prepaid instruments, FAST tags, National Common Mobility Cards, etc. are to be permitted without any restrictions, up to their available balance.
• No other banking services, other than those referred in (ii) above, like fund transfers (irrespective of name and nature of services like AEPS, IMPS, etc.), BBPOU and UPI facility should be provided by the bank after February 29, 2024.
• The Nodal Accounts of One97 Communications Ltd and Paytm Payments Services Ltd. are to be terminated at the earliest, in any case not later than February 29, 2024.
• Settlement of all pipeline transactions and nodal accounts (in respect of all transactions initiated on or before February 29, 2024) shall be completed by March 15, 2024 and no further transactions shall be permitted thereafter.