Paytm Payments Bank: Users may take 3-6 months to shift to other platforms
Paytm Payments Bank: Users may take 3-6 months to shift to other platforms
Users may take three to six months to migrate to another payment service provider (PSP), a report in the Business Standard said on Tuesday. One 97 Communications Ltd is also looking to apply for a third-party application provider (TPAP) licence from the National Payments Corporation of India (NPCI) to ease the process.
A TPAP license will ensure that Paytm users can continue to make digital payments via the Unified Payments Interface (UPI). NPCI is entrusted with the supervision with the regulation and the supervision of UPI and related financial services that work on the network. PSPs need to obtain a TPAP license from NPCI to run UPI services and facilitate merchant transactions through partner banks.
Paytm is presently not classified as a TPAP due to UPI transactions being routed through Paytm Payments Bank.
On the other hand, 22 entities, including Amazon Pay, Google Pay, Mobikwik, PhonePe, and WhatsApp, currently have a TPAP licence.
Besides, TPAPs have to comply with guidelines prescribed by both NPCI and their partner PSPs (banks) and facilitate RBI, NPCI, and other agencies to access their data, information, and systems with respect to UPI transactions.
Last month, the Reserve Bank of India imposed curbs on the operations of Paytm Payments Bank Ltd (PPBL). It directed Paytm Payments Bank to stop accepting deposits or top-ups in customer accounts, wallets, FASTags, and other instruments after February 29. Later, the central bank extended the timeline to March 15.
The regulator reportedly found major irregularities in KYC, which exposed the customers, depositors and wallet holders to serious risks.
“The shift does not happen overnight or over a period of a few days. The process of migrating all Paytm customers to another payment service provider (PSP) may take anywhere between three months and six months, given the large number of customer base that Paytm has,” a source told Business Standard.
As per reports, Paytm is holding talks with Axis Bank, HDFC Bank, and State Bank of India (SBI) for UPI services partnership.
One 97 Communications (OCL) shifted its nodal accounts or escrow accounts to private-sector lender Axis Bank, the company said in a filing to the BSE last week. The move will allow continuity of Paytm QR, Soundbox, card machine after the March 15 deadline set by the Reserve Bank of India, the filing said.
Paytm said the arrangement is expected to replace the nodal account that OCL was using with Paytm Payments Bank. Further, both OCL and Paytm Payment Services Limited are also in discussions with other banks to evaluate a second partner for nodal/escrow services.
Shares of One97 Communications closed at Rs 376.25, up by 5.00 per cent.
Watch Live TV in English
Watch Live TV in Hindi