Anushruti Singh
The Reserve Bank of India (RBI) has instructed the National Payments Corporation of India (NPCI) to review Paytm’s request to become a third-party application provider (TPAP) for UPI payments.
“National Payments Corporation of India has been advised by the RBI to examine the request of One97 Communication Ltd to become a Third-Party Application Provider (TPAP) for UPI channel for continued UPI operation of the Paytm app, as per the norms,” an RBI statement said.
This directive aims to ensure smooth digital payments through the UPI system, particularly via the ‘@paytm’ handle operated by Paytm Payments Bank, while also mitigating concentration risks.
The RBI has specified that no new users should be added by Paytm until all existing users are satisfactorily migrated to a new handle.
Earlier, on January 31, the RBI imposed significant business restrictions on Paytm Payments Bank, including constraints on accepting fresh deposits and conducting credit transactions, effective from February 29. This deadline was subsequently extended to March 15 on February 16.
