Days after the Reserve Bank of India (RBI) imposed major business restrictions on Paytm Payments Bank following persistent non-compliance and continued material supervisory concerns, Ashneer Grover -- former founder of fintech firm BharatPe -- on Wednesday said that the central bank's move was against the interest of fintech firms.
He further called upon finance minister Nirmala Sitharaman and Prime Minister Narendra Modi's office to look into the matter.“ I don’t understand RBI. Clearly RBI does not want FinTechs in business - of late all regulations / moves are against Fintechs. Such moves will kill the sector altogether. The @FinMinIndia @nsitharaman @PMOIndia need to step in. Startups have been biggest creators of market cap and employment in last decade. Today IIM and IIT are struggling to place people - we as a country cannot afford such overreach ! Tom-Tom-Ing @UPI_NPCI to the world and punishing pioneers in the space is pure ‘Doglapan’," wrote Grover on X, formerly Twitter.
For the unversed, RBI had directed Paytm Payments Bank (PPBL) to stop accepting deposits or top-ups in any customer accounts, wallets, FASTTags and other instruments after February 29.
However, the payment bank is allowed to credit interest, cashback, or refunds to customers at times. The RBI order has come after persistent non-compliance and continued material supervisory concerns, RBI said in its statement. Two years ago the RBI had barred PPBL from taking new customers with immediate effect. Till now, Paytm group firm PPBL didn not released any official statement in response to RBI's order.
"No further deposits or credit transactions or top-ups shall be allowed in any customer accounts, prepaid instruments, wallets, FASTags, NCMC cards, etc. after February 29, 2024, other than any interest, cashback, or refunds which may be credited anytime," the RBI said.
The RBI has also terminated ‘nodal accounts’ of One97 Communications Ltd and Paytm Payments Services at the earliest, in any case not later than February 29, 2024. One97 Communications holds a 49 per cent stake in Paytm Payments Bank Limited