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.

Digital transactions have revolutionised the way we conduct financial activities today. These transactions involve the electronic exchange of money or assets between parties, often facilitated through online banking, mobile apps, or digital wallets. This is made possible by Unified Payments Interface (UPI), an instant payment system developed in India by the National Payments Corporation of India (NPCI). It offers unparalleled convenience and speed, allowing individuals and businesses to make payments, transfer funds, and engage in commerce with ease. However, there may be instances when a user needs to reverse a UPI transaction due to reasons such as incorrect recipients, or unauthorised payments.

What NPCI says about reversing a UPI transaction?

The UPI creator has implemented a ‘UPI Auto-Reversal’ system to tackle this problem. It, however, specifies that the online reversal will be triggered for approved cases when the beneficiary bank marks RET (return) in response to auto update.

The circular also has also mentioned a procedure to be followed by the bank to return the money sent through UPI.

Steps to reverse UPI transactions

The first step to do it contact your bank or UPI service provider’s customer support. For raising the request, details like Unique Transaction Reference (UTR) number, date and amount are important.

It is important to report UPI transaction issues promptly as some banks and UPI service providers impose a time limit on such requests.

If the person you have incorrectly sent money to has an account with your bank, officials can directly contact the person and request to reverse the money to you.

If the wrong recipient holds an account with another bank, your bank can only act as a facilitator. It can, however, provide you the details of the branch. Only the manager of that bank branch can help you.

If the recipient fails to respond to your request or the bank is unable to retrieve the amount, a complaint can be filed on the NPCI portal. If the complaint remains unresolved for more than 30 days, you can approach the Banking Ombudsman and escalate the issue.