Paytm Payments Bank Begins Winding Up After RBI Cancels Its License

The RBI had cancelled the banking license of PPBL on Friday stating that its affairs were conducted in a manner detrimental to the interest of the bank and its depositors, marking the final regulatory
action against the bank after a series of restrictions that were imposed since 2022.

In a regulatory filing, Paytm (One 97 Communication Ltd) said that following the completion of the winding-up process, PPBL will cease to be an associate of One 97 Communications Ltd (OCL). It added that it does not have any exposure or material business link with PPBL and that all Paytm services continue to operate without interruption.

The company further reassured users and merchants that its platform will continue to operate without disruption. Its core offerings including the Paytm app, UPI services, Paytm Gold, and merchant solutions such as QR codes, Soundbox devices, and card machines remain fully functional. Other services, including its payment gateway and wealth management platform Paytm Money, will also continue as usual.

Shares of One 97 Communications Ltd (Paytm) are likely to be in focus on Monday.

Meanwhile, according to a news report, over ₹800 crore of customer funds remain stuck in Paytm Payments Bank, nearly two years after its operations were halted by the regulator. Of the total amount, around half is locked in frozen accounts, while another ₹400 crore remains unclaimed. The report said that there has been no meaningful drawdown in these balances over the past year, despite customers being given repeated opportunities to withdraw or transfer funds.

Before regulatory action began, the bank held deposits exceeding ₹5,500 crore. It also had a large customer base of about 35 crore accounts, of which only around 10–10.5 crore were active. The rest
were largely dormant, frozen, or flagged as mule accounts, a major concern for RBI.