The Reserve Bank of India has withdrawn the banking permit granted to Paytm Payments Bank, effective 24 April 2026.
As a result, Paytm Payments Bank must immediately cease carrying on the business of “banking” as set out in Section 5(b), along with any other permitted business activities, the apex bank.
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The RBI said it will move the High Court with a petition to wind up the bank.
It added that Paytm Payments Bank holds sufficient liquidity to meet all deposit liabilities during the winding-up process.
According to the central bank, the permit was withdrawn because the bank’s affairs were being run in a way that harmed the interests of the institution and its depositors.
It also said the overall nature of the bank’s management was “prejudicial to the interest of depositors” and to the wider public interest.
The RBI said there was no useful purpose or public interest in allowing the bank to continue operations.
It further said the bank did not meet the conditions attached to its Payments Bank permit, amounting to a breach of Section 22(3)(g) of the Banking Regulation Act.
The latest step follows earlier supervisory action. The bank had been told to stop taking on new customers from 11 March 2022.
Later, on 31 January 2024 and 16 February 2024, the RBI placed additional restrictions on the bank’s operations, including a bar on further deposits, credits and top-ups in existing customer accounts, prepaid instruments and wallets.
