Paytm bank: Enough with rumours, here's how your wallet balance will work

Inform the company if you wish to opt out or transfer balance

Users of mobile wallet Paytm may have received alerts advising them not to believe rumours that their mobile wallets will stop working after January 15. This rumour started after launch of the Paytm Payments Bank, which necessitates migration of mobile wallets to the bank, by One97 Communications. Paytm  has 180 million registered users.

Migration of the wallets to the bank will happen automatically, and mobile wallet customers will continue to enjoy all the benefits associated with their existing wallet, said Madhur Deora, chief financial officer, Paytm. 

“Only wallets that have been inactive for six months will not be transferred to the payments bank, unless users give specific consent for the same,’’ he added. Such users should send an e-mail to care@paytm.com, or log into the website to notify the company if they want to opt out or transfer their money. 

To transfer their money, users should provide details such as name, bank account number and IFSC code. The money will be transferred to their accounts within 15 days of Paytm getting the e-mail, according to a notice issued by Paytm. This transfer would be free. 

“If you fail to send the e-mail, your wallet money will be kept in a special designated account with Paytm Payments Bank, but you will not be able to transact the money in it till you submit bank details and transfer it to your own bank account,’’ the notice said.

Migration of wallets to the payments bank does not mean the wallet users will become account holders of the payments bank automatically. That option will be given once the bank launches full-fledged operations.

For now, the wallets will continue in their existing state, that is, either as a full Know Your Customer (KYC) wallet or minimum KYC wallet. Full KYC users can store up to Rs 1 lakh, while minimum KYC users can store up to Rs 20,000. 

Opening an account with the Paytm Payments Bank can have its benefits. “It would mean access to a range of financial services, including savings and current bank accounts, and debit card facilities. 

Customers would also earn interest on the money available in their account,’’ said Deora.

If you have a Paytm payments bank account and a wallet, you would be able to transfer funds seamlessly between the two. Now, wallet users have to transfer funds from their other bank accounts through net banking, debit or credit card. 

But, you cannot have a balance in the payments bank account of more than Rs 1 lakh, according to Reserve Bank of India (RBI) guidelines, said V N Kulkarni, a former official of the Bank of India and debt counseller with Abhay. Also, if all banking operations are to be carried out using only mobiles, customers must be careful about security, he added. 

According to RBI guidelines, a payments bank can offer only savings bank accounts and transaction services. Airtel, the first payments bank to launch operations in November 2016, is offering 7.25 per cent interest for the savings bank accounts. 

Vijay Shekhar Sharma owns 51 per cent in Paytm Payments Bank, while One97 Communications owns the rest.