News Brief
Paytm Gets NPCI Approval For Onboarding New UPI Users Amid RBI Restrictions On Payments Bank
Illustration: Paytm Brand Logo
The National Payments Corporation of India (NPCI) has granted approval to Paytm to onboard new UPI users, subject to adherence to all procedural guidelines and circulars, according to the company.
This decision will provide a significant boost to Paytm, which faced a blow earlier this year due to the Reserve Bank of India's restrictions on its associate company, Paytm Payments Bank Limited (PPBL), limiting its ability to onboard new UPI users on the Paytm platform.
In March, the NPCI granted Paytm approval to engage in UPI transactions as a Third-Party Application Provider (TPAP), allowing the company to process UPI transactions through four banks: SBI, Axis Bank, HDFC Bank, and YES Bank.
In a late evening filing on Tuesday (22 October), Paytm informed the Bombay Stock Exchange (BSE) that it has received approval from the NPCI to onboard new UPI users.
"...We would like to inform you that vide letter dated October 22, 2024, the National Payments Corporation of India (NPCI) has granted approval to the company to onboard new UPI users, with adherence to all NPCI procedural guidelines and circulars," the Paytm filing, which also attached the NPCI letter granting the nod, said.
According to the letter, the approval is subject to adherence to all NPCI procedural guidelines and circulars issued from time to time, including guidelines and circulars issued specifically on risk management, brand guidelines for app and QR, multi-bank guidelines, TPAP market share, and customer data.
One97 Communications is the parent company of fintech firm Paytm.
The NPCI has permitted One97 Communications Limited (OCL) to onboard new users on its UPI app, following a request submitted on 1 August 2024.
"Upon examination of your request, we hereby accord our approval and permit One97 Communications Private Limited (OCL) to onboard new users on their UPI application," the Paytm filing said, listing out the various conditions.
In a decisive action against Paytm Payments Bank (PPBL), the Reserve Bank of India (RBI) instructed the bank on 31 January 2024 to halt the acceptance of deposits or top-ups across customer accounts, wallets, FASTags, and other instruments, citing persistent non-compliance and significant supervisory concerns.
