Paytm Payments Bank Is Your Money Safe After February 29 All Questions Related to RBI Ban

The Reserve Bank of India (RBI) on January 31, 2024, had barred Paytm Payments Bank (PPBL) from opening new accounts, accepting deposits in pre-existing accounts and completing KYC processes due to some serious deficiencies. After this news came out, there was a sudden stir and many rumors started spreading on social media. However, both Paytm and RBI have tried to make people aware about this decision, in which it has been told which services will remain operational in Paytm Payments Bank after February 29 and which will be stopped. However, even after that, those having accounts 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 your bank account is in Paytm Payments Bank, then this restriction will directly affect you. However, what is the level of this impact and which services will you be able to avail from February 29 and which services will not, let us tell you in detail.

Question 1: Why was Paytm Payments Bank banned?

Answer: RBI had banned Paytm Payments Bank due to violation of KYC norms and flaws in data security framework. Almost all the services of PPBL are being stopped from March 1. However, for the convenience of account holders and to avoid any panic situation, some services will be continued for some time.

Question 2: How will this ban affect your Paytm Payments Bank account?

Answer: You can make deposits, credits, UPI transactions, and transfer funds to your Paytm Payments Bank account till 29 February 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 till it is used or withdraw it and deposit it in another bank account.

RBI has said that existing customers of the bank will be able to withdraw money from their account and use it until the balance available in their bank account is exhausted. Further, RBI has said that all pipeline transactions and settlement of 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 through ATM, UPI, or Paytm app even after 29 February 2024.

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 the event of insolvency of the lending bank. Under DICGC, all commercial banks including branches of foreign banks, local area banks and regional rural banks operating in India 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 into 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 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 any other bank.

Question 8: Will all the services of Paytm be stopped?

Answer: Paytm founder and CEO Vijay Shekhar Sharma had said last year that Paytm Payments Bank Limited i.e. PPBL and One97 Communication Limited (OCL), which owns the Paytm app, are two separate 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.