A breather for Paytm Payments Bank? What RBI's FAQs for customers indicate

Soon after the FAQs were issued by the Reserve Bank of India (RBI), sources close to the Paytm group said that the central bank had brought clarity to the entire payments issue. The Paytm Payments Bank crisis is being talked about within the group as a stress test that every successful venture has to go through.  

Paytm founder Vijay Shekhar Sharma’s late evening posts on X captured the breather that the fintech may have got for the first time since the January 31 RBI directive to restrict deposits, top-ups and transactions with effect from March 1, which has now been extended by a fortnight. Sharma cited point 21 of the RBI FAQ in his social media posts to drive home the message.

Point 21 referred to continuity of business beyond March 15 through QR, soundbox and card machines for Paytm’s merchants whose accounts are linked to banks other than Paytm Payments Bank. ‘’The latest FAQ issued by RBI on point number 21 clarifies it unambiguously,’’ Sharma said in his post.  

The company is shifting its nodal account to Axis Bank to continue merchant settlements. Also, an estimated 90 per cent of the Paytm Payments Bank’s UPI users are learnt to have their accounts already linked to other banks.

Even as the sources Business Standard spoke to refused to talk about the damage to the Paytm brand and the company’s overall business after the RBI directive, they reiterated that the core part of Paytm’s business (with merchants) will continue in perpetuity and that the fintech India story that the group represents will go on. They denied that the company was in talks with anybody for selling any of its business.