Paytm Payments Bank has taken a significant step by temporarily disabling international transactions through its debit cards, leaving customers unable to initiate such transactions. The reasons behind this move remain undisclosed, and the bank has not provided a timeline for the resumption of this service.
The decision comes in the wake of a fine imposed by the Reserve Bank of India (RBI) for non-compliance with Know Your Customer (KYC) and cybersecurity norms.
Paytm Payments Bank ventured into the issuance of Visa debit cards in March 2020, initially offering digital cards but later introducing physical Visa cards and partnering with the state-backed card network RuPay for debit card services.
Despite its association with parent company One97 Communications, Paytm Payments Bank has faced regulatory scrutiny for over a year, with the RBI preventing it from onboarding new customers due to "material supervisory concerns."
In response, Paytm Payments Bank claims to have implemented several recommendations from the RBI's IT review conducted in the previous fiscal year. While the central bank has yet to make a decision, Paytm's president and chief operating officer (COO), Bhavesh Gupta, expressed hope for a removal of restrictions by March 2024.
Despite the regulatory challenges, One97 Communications has shown remarkable financial progress, with a 44.5% YoY reduction in consolidated net loss to INR 358.4 Cr in Q1 FY24 and a 39% rise in revenue to INR 2,342 Cr in the same period.
Established in 2017, Paytm Payments Bank is a leading payments bank in India, offering mobile banking and ewallet services.
In 2022, it achieved recognition as one of India's top mobile banking service providers and ranked sixth worldwide in terms of ewallet users. Paytm owns a 49% stake in the payments bank.
Stay tuned for Paytm's financial results for the July-September quarter, set to be released on October 20. The company's shares concluded Thursday's session at INR 968.7 on the BSE, marking a 2.18% increase.
Highlight of News