Mumbai, April 24 (IANS). The Reserve Bank of India (RBI) on Friday canceled the license of Paytm Payments Bank Limited. RBI said that the bank did not follow the necessary rules related to its license.
The Central Bank made it clear that now this bank will not be able to provide any kind of banking services and an application will be made in the High Court for winding it up.
RBI said in its order that the license of the bank has been canceled under Section 22(4) of the Banking Regulation Act, 1949, with effect from close of business on April 24.
Now, Paytm Payments Bank Limited is not permitted to carry on any banking business with immediate effect, as per Section 5(b) and 6 of the Act.
RBI also said that it will apply to the High Court to close the bank.
However, the central bank assured that the bank has enough money (liquidity) that it can return the deposits of all its customers.
According to RBI, there will be no benefit in continuing the bank nor is it in the public interest.
The RBI said the bank did not comply with the conditions of its license, thereby violating the rules of the Banking Regulation Act.
Even before this, action was taken against the bank, and adding new customers was banned from March 11, 2022.
After this, several restrictions were imposed on the bank on 31 January 2024 and 16 February 2024, which included ban on services like depositing money in existing accounts, top-up in wallet.
–IANS
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