On January 31, 2024, the Reserve Bank of India (RBI) barred Paytm Payments Bank (PPBL) from opening new accounts, accepting deposits in existing accounts and completing KYC processes due to some serious deficiencies. After this news came out, there was a sudden uproar and many rumors started spreading on social media.
However, both Paytm and RBI have tried to make people aware of this decision, which tells which services will continue in Paytm Payments Bank after February 29 and which will be discontinued. However, even after that, those who have an account in PPBL are afraid of many things.
Through this post, we are answering those important questions, through which we hope to end the dilemmas of PPBL account holders.
If you have a bank account in Paytm Payments Bank, then this ban will directly affect you.
However, what is the level of this impact and which services you will be able to avail from February 29 and which services you will not, let us tell you in detail.
Question 1: Why was Paytm Payments Bank banned?
Answer: RBI had imposed restrictions on Paytm Payments Bank due to violation of KYC rules and flaws in data security framework. Almost all the services of PPBL are being closed from March 1. However, some services will be kept running for some time for the convenience of account holders and to avoid any kind of panic situation.
Question 2: How will this restriction impact your Paytm Payments Bank account?
Answer: You can make deposits, credits, UPI transactions, and fund transfers in your Paytm Payments Bank account until February 29, 2024. After February 29, 2024, you will not be able to deposit money in your Paytm Payments Bank account. In such a situation, you can either keep your money in the bank until it is used or withdraw it and deposit it in another bank account.
RBI has said that the existing customers of the bank will be able to withdraw and use the money from their account till the available balance in their bank account is exhausted.
Apart from this, RBI has said that the settlement of all pipeline transactions and nodal accounts initiated on or before February 29, 2024 will be completed by March 15, 2024. After March 14, no such transactions will be allowed.
Question 3: How can you withdraw money from your Paytm Payments Bank account?
Answer: You can withdraw money from your Paytm Payments Bank account even after February 29, 2024 via ATM, UPI, or Paytm app.
Question 4: Is your money in PPBL insured under DICGC?
Answer: Yes, as per the rules, individual deposits up to Rs 5 lakh in all regulated banks under RBI are protected in case the lending bank goes bankrupt. Under DICGC, all commercial banks including branches of foreign banks operating in India, local area banks and regional rural banks are insured.
Question 5: Should you close your Paytm Payments Bank account?
Answer: It depends on your own wish. If you do not want to make new deposits in your Paytm Payments Bank account after February 29, 2024, you can close your account.
Question 6: How can you close your Paytm Payments Bank account?
Answer: You can close your account through the Paytm Payments Bank app or by contacting Paytm Payments Bank customer care.
Question 7: Can you transfer your Paytm Payments Bank account to another bank?
Answer: No, you cannot transfer Paytm Payments Bank account to another bank.
Question 8: Will all services of Paytm be stopped?
Answer: Paytm founder and CEO Vijay Shekhar Sharma said last year that Paytm Payments Bank Limited i.e. PPBL and One97 Communication Limited (OCL) which owns the Paytm app are two different companies. Even after the closure of the bank, you will be able to use the Paytm app and avail many other services including recharge, bill payment.
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