Paytm Payments Bank ,
- Limited has been prohibited by Reserve Bank of India from opening any new accounts and wallets with effect from June 20, 2018 on account of violation of certain licensing conditions and operating guidelines.
- However, no restriction has been placed on the bank for servicing its existing customers.
Paytm Payments Bank has stopped enrolment of new customers on its platform following observations made by the Reserve Bank of India, four people with knowledge of the matter said. Paytm stopped enrolling new customers on 20 June following an audit by RBI, which made certain observations about the process the company follows in acquiring new customers and its adherence to know-your-customer (KYC) norms, three of the four people said, requesting anonymity.
- “RBI has directed Paytm Payments Bank to stop onboarding of new customers with immediate effect,” said one of the four people.
- Another person, a company executive, said that Paytm is modifying its “account opening process to introduce ‘current accounts’ due to which new account creation process has been paused”.
- Paytm was also asked to remove Renu Satti as chief executive of the payments bank following RBI’s objections about her ability to lead a banking services firm, said the third of the four people quoted earlier. RBI requires a person to be a banker in order to become the chief executive of a payments bank.
Importantly, the lackadaisical attitude of payments banks and how they are exploiting the ecosystem were exposed when Airtel Payments Bank was accused for surreptitiously adding customers during the Aadhaar verification of their mobile numbers.
The addition of over 30 lakh customers to Airtel’s Payments had been a major embarrassment for the telecom company after UIDAI issued a show-cause notice to the company and later suspended the online Aadhaar verification process for Airtel and its payments bank. However, it received approval to open new accounts in July.
- Despite all the freebies offered by payments banks in the form of cashbacks— which the RBI has strongly objected, they have failed to pull customers.
- Experts reason that payments banks can’t lend in any form like the other banking bodies do and make revenue out of lending and credit card business. Moreover, payments banks are allowed to accept only savings and current deposits of up to Rs 1 lakh per customer.
- The cap on deposit with the current account at one time also makes it irrelevant for SMEs.
- Currently there are four payment banks operating in the country – Paytm, Airtel, Fino and Aditya Birla-Idea Payments Bank. India Post Payments Bank will start its operations on September 1.
No comments:
Post a Comment