RBI Cancels Banking Licence of Paytm Payments Bank, Here’s Why
The Reserve Bank of India announced on Friday that it has revoked Paytm Payments Bank’s banking license. The RBI stated that the license was revoked because the affairs of the bank were conducted in a manner detrimental to the interest of the bank and its depositors. It said, “The overall nature of the bank’s management is harmful to the interests of depositors as well as the public good.”
By order dated April 24, 2026, the Reserve Bank of India (RBI) has revoked Paytm Payments Bank Limited’s banking license, which was granted under Section 22(4) of the Banking Regulation Act of 1949 (BR Act), effective from the close of business on April 24, 2026.
As a result, Paytm Payments Bank Limited is now prohibited from engaging in the business of banking as defined by Section 5(b), or any additional business specified under Section 6 of the Banking Regulation Act, 1949. The RBI stated that it will apply to the High Court for the bank to be wound up.
Due to what it claimed at the time was non-compliance with rules pertaining to customer due diligence, use of funds and technological infrastructure, the RBI issued an order in January 2024 directing the bank to cease taking new deposits. In the past, the RBI ordered the bank to cease enrolling new customers as of March 11, 2022, according to the reports.
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