Paytm in a statement issued on Thursday said it expects a worst-case impact of 300 crore rupees ($36.13 million) to 500 crore rupees on its annual earnings from the Reserve Bank of India order preventing its unit, Paytm Payments Bank, from accepting fresh deposits. of March
“Based on the nature of the resolution, the Company expects this action to have a worst-case impact of Rs 300 to 500 crore on its annual EBITDA going forward. However, the Company expects to continue its trajectory to improve its profitability,” it. stated
Paytm Payments Bank issued a clarification, saying it will take immediate steps to comply with RBI’s directions, including working with the regulator to address their concerns as quickly as possible.
The baby bank clarified that it will continue to provide payment solution to existing merchants, and this will not affect user deposits in their savings accounts, Wallets, FASTags and NCMC accounts.
However, the company stated that regarding the direction of closure of nodal account of OCL (One 97 Communications Limited) and Paytm Payments Services Limited (PPSL) by February 29, 2024, OCL and PPSL will move the nodal to other banks while this. period
The Reserve Bank of India (RBI) on Wednesday imposed restrictions on Paytm Payments Bank Ltd (PPBL), following a system audit report and subsequent confirmation report by external auditors.
The bad bank is prohibited from accepting deposits or charges in any customer account, wallets or FASTags after February 29 under section 35A of the Banking Regulation Act, 1949.
“No other banking services like wire transfers (irrespective of name and nature of services like AEPS, IMPS, etc.), BBPOU and UPI facility should be provided by the bank after February 29, 2024,” the RBI statement said .
The RBI further mentioned that the Nodal Accounts of One97 Communications and Paytm Payments Services Ltd. must be terminated at the earliest, in any case no later than February 29, 2024.
The audit reports revealed persistent non-compliance and ongoing material control concerns in the bank, warranting further supervisory action, the RBI said in a statement.