Paytm Payments Bank Ltd (PPBL) has received the final licence from the RBI which would enable the brand to start the payments bank. It is expected to commence its operations on May 23, 2017.
The company will transfer its wallet business which is predominantly found in most of the smartphone and boasts over 218 million users, to the newly incorporated entity -PPBL – under the payments bank licence. This was awarded to a Vijay Shekhar Sharma, the founder of One97 Communications which owns Paytm.
Payments banks is similar to verified wallets where deposits of upto Rs.1 lakh can be made into the account in a month. Any inactive wallets with no activity in the past six months will happen only after receiving the customer’s consent where as the active users will receive a notice on or before May 23 which is the cut-off date where they can either migrate to PPBL or get their wallet balance transferred to their bank account.
RBI as a part of Digital India initiatives, has given in-priniciple nod last year for 21 entities with 11 for Payments Bank. Airtel commenced its operations and so as India Post and PayTM is the latest to join. Aditya Birla Group’s Idea Payments Ban is also expected to launch its services soon.
Even though PayTM is funded by Alibaba Group, they will not have any share holding in the Payments Bankas per the RBI regulations.