Paytm Payments Bank Barred From Onboarding New Customers by RBI With Immediate Effect

On Friday, the RBI requested Paytm Payments Bank to cease opening new accounts amid “significant oversight concerns” seen on the financial institution.

“The Reserve Bank of India has today, in the exercise of its powers, particularly under Section 35A of the Banking Regulation Act 1949, ordered Paytm Payments Bank Ltd to stop, with immediate effect , onboarding new customers,” the central financial institution mentioned. in a report.

The financial institution has additionally been instructed to nominate an IT audit agency to hold out a complete audit of its IT system.

“The onboarding of new customers by Paytm Payments Bank will be subject to specific authorization granted by RBI after review of the report of the IT auditors. This action is based on certain significant oversight concerns observed in the bank,” he mentioned. .

Paytm Payments Bank was included in August 2016 and formally began operations in Might 2017 from a department in Noida.

In December 2020, the RBI banned HDFC Bank from launching any new digital services or products and issuing new bank cards till the lender resolved the recurring technical points.

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