RBI Bars Paytm Payments Financial institution From Onboarding New Buyers

The RBI on Friday questioned Paytm Payments Bank to halt opening new accounts amid “content supervisory concerns” noticed in the lender.

“Reserve Financial institution of India has now, in physical exercise of its powers, inter alia, less than segment 35A of the Banking Regulation Act, 1949, directed Paytm Payments Financial institution Ltd to halt, with rapid effect, onboarding of new shoppers,” the central lender claimed in a statement.

The bank has also been directed to appoint an IT audit agency to conduct a extensive process audit of its IT program.

“Onboarding of new customers by Paytm Payments Bank will be topic to certain authorization to be granted by RBI soon after examining report of the IT auditors. This action is based mostly on specified substance supervisory considerations noticed in the financial institution,” it mentioned.

Paytm Payments Financial institution was included in August 2016 and formally began its operations in Might 2017 from a department in Noida.

In December 2020, the RBI experienced barred HDFC Financial institution from launching any new electronic merchandise or companies and issuing new credit playing cards until the financial institution resolved recurring tech challenges.

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