RBI asks NPCI to examine Paytms request to become 3rd party application provider in UPI system
Paytm news: It has been further advised that in the event of NPCI granting TPAP status to OCL, it may be stipulated that @paytm handles are to be migrated in a seamless manner from Paytm Payments Bank to a set of newly identified banks to avoid any disruption. No new users are to be added by the said TPAP until all the existing users are migrated satisfactorily to a new handle.
Paytm Payments Bank news: In a major development on Friday (February 23), the Reserve Bank of India (RBI) asked National Payments Corporation of India (NPCI) to examine the use of the UPI channel to allow Paytm app to continue operations.
In a statement on Friday, the RBI said, "National Payments Corporation of India (NPCI) has been advised by the RBI to examine the request of One97 Communication Ltd (OCL) to become a Third-Party Application Provider (TPAP) for UPI channel for continued UPI operation of the Paytm app, as per the norms.
It has been further advised that in the event of NPCI granting TPAP status to OCL, it may be stipulated that ‘@paytm’ handles are to be migrated in a seamless manner from Paytm Payments Bank to a set of newly identified banks to avoid any disruption, the statement further reads. No new users are to be added by the said TPAP until all the existing users are migrated satisfactorily to a new handle.
The RBI said that for seamless migration of ‘@paytm’ handle to other banks, NPCI may facilitate certification of 4-5 banks as Payment Service Provider (PSP) banks with demonstrated capabilities to process high volume UPI transactions. This is in line with NPCI norms for minimising concentration risk1.
For the merchants using PayTM QR Codes, OCL may open the settlement accounts with one or more PSP Banks (other than Paytm Payments Bank), the RBI told NPCI.
The migration of UPI handles as above is applicable only to such customers and merchants who have a UPI handle ‘@Paytm’. For others who have a UPI address or handle other than ‘@Paytm’, no action is required to be taken by them, as per the RBI.
Similarly, the customers whose underlying account/wallet is currently with Paytm Payments Bank, are advised to make alternative arrangement with other banks well before March 15, 2024, as already advised in the FAQs released by RBI on February 16, 2024.
The RBI says that it is reiterated that the holders of FASTag and National Common Mobility Cards (NCMC) issued by Paytm Payments Bank, may make alternative arrangements before March 15, 2024 to avoid any inconvenience.
"All the above actions are undertaken in the sole interest of protecting the customers and payment system from any possible disruptions and are without any prejudice to the regulatory or supervisory actions initiated by RBI against Paytm Payments Bank," the RBI said in the statement.
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.