New Delhi, Mar 11: The Reserve Bank of India (RBI) on Friday directed Paytm Payments Bank Ltd to cease opening new accounts amid “material supervisory concerns” noticed within the financial institution.
“Reserve Bank of India has today, in exercise of its powers, inter alia, under section 35A of the Banking Regulation Act, 1949, directed Paytm Payments Bank Ltd to stop, with immediate effect, onboarding of new customers,” the central financial institution stated in a press release.
Motion in opposition to Paytm Payments Bank Ltd below part 35 A of the Banking Regulation Act, 1949https://t.co/tqWfwt7mT3
— ReserveBankOfIndia (@RBI) March 11, 2022
The financial institution has additionally been directed to nominate an IT audit agency to conduct a complete system audit of its IT system.
“Onboarding of new customers by Paytm Payments Bank Ltd will be subject to specific permission to be granted by RBI after reviewing report of the IT auditors. This action is based on certain material supervisory concerns observed in the bank,” it stated.
Paytm Payments Bank was included in August 2016 and formally started its operations in Could 2017 from a department in Noida.
In December 2020, the RBI had barred HDFC Bank from launching any new digital services or products and issuing new bank cards until the lender resolved recurring tech points.
Story first printed: Friday, March 11, 2022, 19:44 [IST]