KYC (Know Your Customer) formalities for its wallets as well as its bank accounts from December 31, confirmed a company spokesperson.
The RBI had asked the bank to stop adding new customers about six months back in June, when a regulatory audit found lapses on the part of the entity to stick to RBI’s requirements. Post the audit, Paytm Payments Bank had removed Renu Satti from the chief executive’s role and roped in veteran banker and ex-NPCI senior executive Satish Gupta for the corner office at the Noida-based bank.
“Paytm Payments Bank is on a mission to facilitate the last-mile delivery of banking services to every Indian. It also envisions catalysing the digital adoption and acquainting more people with the touch-of-a-button experience. believe it is going to help in the formalisation of our economy and bring about the much-needed real financial inclusion,” said Gupta in a written statement to ET. When asked by ET, a Paytm Payments Bank spokesperson said that there was no fine levied by the RBI. Further, he added that the bank currently has around 42 million accounts and has set a target of getting 100 million by the end of 2019. Though the RBI had not released a statement clearing out the reason for their action, Times of India had reported that the regulator was not satisfied with the close relations that One97 Communications had with Paytm Payments Bank, and had also failed to maintain the net worth limit of Rs 100 crore.
A top industry observer, speaking to ET on the condition of anonymity, pointed out that payment banks have still not had a major impact on the overall financial ecosystem in the country. “Paytm has got a large chunk of its customers to use the bank account and the wallet interchangeably and has also played a critical role in driving financial inclusion,” he said.
“Now under the new leadership they will try again to expand their reach and get more customers.” Besides Paytm Payments Bank, Fino Payments Bank was also barred from opening fresh accounts by the RBI mainly because of its failure to impose a deposit limit of Rs 1lakh on the accounts customers held with the bank. Fino got the go-ahead earlier in October. However, the bank was also fined Rs 1 crore by the regulator. Paytm Payments Bank also reported a net loss of Rs 20 crore against revenue of Rs 720 crore in FY2018. Out of the total income, the bank reported Rs 654 crore as income from brokerages, commissions and exchanges which include its income from the wallet operations. As per its last year filings the bank had gathered a deposit of Rs 144 crore including wallet balances.