Paytm, an app for digital payments and services, is operational and will stay that way even until February 29, according to CEO Vijay Shekhar Sharma’s statement on Friday.
On social networking platform X, the founder and CEO of One97 Communications Ltd (OCL), the firm that owns the Paytm brand, declared that the company is dedicated to providing full compliance services to the country.
“To every Paytmer, Your favourite app is working, will keep working beyond 29 February as usual,” Sharma stated.
After February 29, 2024, the RBI has prohibited Paytm Payments Bank Ltd (PPBL) from taking deposits or top-ups in any customer account, prepaid cards, wallets, and FASTags, among other things.
PPBL is classified by OCL as an associate of the corporation rather than a subsidiary, despite OCL owning a 49 percent share in the latter.
“I, along with the entire Paytm team, thank you for your unwavering support. There is always a solution to a problem, and we genuinely want to serve our country to the best of our abilities. India would continue to lead the world in payment innovation and financial services inclusion, Sharma said, with PaytmKaro serving as its main benefactor.
During a Thursday earnings call, Paytm’s top management stated that they are developing a plan to migrate users of their wallet, FASTag, PPBL, and other services to other banks.
The RBI ruling, according to the company, will affect its yearly operational earnings by around Rs 300–500 crore since its clients won’t be able to add money to their wallets or use FASTag, among other services.
Separately, the company stated that the Reserve Bank of India’s (RBI) directive to its associate bank has no bearing on its offline merchants network offering or device business, which includes Paytm Soundbox, EDC, and QR.
The finance business will keep adding merchants to its platform through onboarding.
“The Paytm Payment Gateway company (online retailers) will keep providing payment options to its current clients. The business stated that other financial services including loan distribution, insurance distribution, and equity broking are unrelated to Paytm’s associate bank and should not be impacted by this move.
According to Paytm, users can keep using their current amounts in their savings accounts, wallets, FASTags, and NCMC (National Common Mobility Card) accounts, and the RBI decision has no effect on their deposits.
RBI has mandated that PPBL pay all nodal accounts and pipeline transactions (pertaining to all transactions started on or before February 29, 2024) by March 15, 2024, beyond which point no more transactions would be allowed.
Sharma stated on the call that the RBI order is a “big speed bump” and that he was unable to determine the precise nuance that sparked the move.
“On behalf of Paytm I can say it is more of a big speed bump but it is something that we believe that with partnership of other banks and capabilities that we have already developed, we will be able to see through in the next few days or quarters as the case will be,” he had stated.
