Home / Business and Economy / RBI Cancels Paytm Payments Bank License Over Compliance Lapses
RBI Cancels Paytm Payments Bank License Over Compliance Lapses
24 Apr
Summary
- RBI revoked Paytm Payments Bank's license after previous curbs.
- Bank had a limited license since August 2015, unable to offer loans.
- RBI will apply to wind up the bank before the high court.
The Reserve Bank of India (RBI) has officially cancelled the banking license of Paytm Payments Bank Ltd. This decision comes more than two years after the regulator initially imposed business restrictions.
The initial curbs were implemented due to significant violations, particularly concerning lapses in customer due diligence. Paytm Payments Bank had been operating with a limited license since August 2015, authorized only to accept small deposits and not to disburse loans.
In January 2026, the RBI had already ordered the bank to cease accepting new deposits. This was attributed to non-compliance with various regulations, including customer due diligence and fund utilization. The RBI announced on Friday that it will submit an application to the high court for the bank's winding up.
Currently, Paytm Payments Bank remains operational but with severely restricted functions. Its activities are confined to processing existing deposit withdrawals and facilitating loan referrals via banking correspondents. The bank is strictly prohibited from accepting any fresh deposits.
