KYC-AML rule breach led to lens on Paytm Payments Bank: Sources

Analysts expect Paytm's business to be affected owing to the ban

The Reserve Bank of India (RBI) has prohibited Paytm Payments Bank from acquiring new customers primarily owing to violations of norms on “know your customer —anti-money laundering (KYC-AML)”, multiple sources told Business Standard.

Banks are supposed to undertake due diligence of customers before on-boarding, which is the first step. If a bank fails in this, other issues crop up.

The payments bank, in which Vijay Shekhar Sharma has a 51 per cent stake, and One 97 Communication 49 per cent, was directed by the banking regulator to appoint a firm for an I-T audit. The RBI said approval to acquire