Paytm, on February 9, announced setting up of a group advisory committee to advise the company on strengthening compliance and on regulatory matters.
| Photo Credit: The Hindu
Shares of Paytm owner One97 Communications jumped 5% in the morning trade on February 26 after Reserve Bank of India (RBI) asked retail payment settlement body NPCI to examine the possibility of migrating Paytm Payments Bank customers using ‘@paytm’ UPI handle to other banks.
The stock of crisis-hit fintech company climbed 5% each to ₹428.10 and ₹427.95 apiece — also its upper circuit limit — on the NSE and BSE.
In the morning trade, the 30-share BSE Sensex benchmark slumped 288.71 points or 0.39%, while NSE Nifty fell 71.55 points to 22,141.15. On February 23, the scrip of One97 Communications rallied 5% and locked in upper circuit limit on the BSE.
In a bid to prevent any disruptions in the payment ecosystem, the RBI on Friday asked the National Payments Corporation of India (NPCI) to examine the possibility of migrating Paytm Payments Bank customers using the UPI handle ‘@paytm’ to four to five other banks.
The Central bank came out with additional steps for the benefit of customers, wallet holders and merchants who are availing banking services from Paytm Payments Bank, which has been barred from accepting deposits and credits after March 15, 2024.
“As the PPBL cannot accept further credits into its customer accounts and wallets after March 15, 2024, certain additional steps have become necessary to ensure seamless digital payments by UPI customers using ‘@paytm’ handle operated by the bank, and minimise concentration risk in the UPI system by having multiple payment app providers,” the RBI said in a statement.
“NPCI has been advised by the RBI to examine the request of One97 Communication Limted (OCL) to become a Third-Party Application Provider (TPAP) for UPI channel for continued UPI operation of the Paytm app, as per the norms,” it said.
Meanwhile, an advisory committee, set up by One97 Communications after the Reserve Bank’s action on its payments bank business, is at a stage of engagement with the company on matters related to the terms of reference for the panel.
The panel’s head and former chairman of Securities and Exchange Board of India M. Damodaran on February 25 said, “We have been engaging with the group on matters relating to the Advisory Committee’s terms of reference.” He said that the panel members are external advisors and at present Paytm is engaged in dealing with the RBI.
On January 31, the RBI asked PPBL (Paytm Payments Bank Limited) to stop further deposits, credit transactions, or top-ups in any customer accounts, prepaid instruments, wallets, FASTags, and National Common Mobility Cards, after February 29. Later, the Central bank extended the deadline till March 15.
Paytm on February 9 announced setting up of a group advisory committee headed by Damodaran. The committee was set up to advise the company on strengthening compliance and on regulatory matters. One97 Communications Ltd (OCL) holds a 49% stake in PPBL.
