The National Payments Corporation of India on Thursday said it granted approval to One97 Communications Limited (OCL), Paytm’s parent entity, a third-party application provider (TPAP) licence. This move comes as Paytm’s banking unit faces closure, necessitating alternative arrangements for facilitating payments.
Paytm has partnered with four banks to serve as Payment System Providers (PSPs) to facilitate its payment services. The partnered banks include Axis Bank, HDFC Bank, State Bank of India, and YES Bank.
The regulatory authority also instructed Paytm to promptly migrate all existing handles and mandates, as necessary, to the new PSP banks without delay. The approval enables the utilization of the Paytm app for payments via the Unified Payments Interface (UPI).
As a result of the Reserve Bank of India (RBI) imposing restrictions on Paytm Payments Bank Ltd (PPBL) on January 31, 2024, several Paytm services are set to cease operations after March 15. Following the RBI’s directive, PPBL is prohibited from accepting new deposits or top-ups after March 15 due to ongoing non-compliance and significant supervisory concerns.
