Restrictions on Paytm, RBI orders to stop taking on new customers; suggests to appoint a specialized company to conduct audit

NEW DELHI: The Reserve Bank of India (RBI) has imposed restrictions on online payment app Paytm Payments Bank Limited. The RBI has also directed to immediately stop the recruitment of new customers. It has also been suggested that a specialized company should be appointed to conduct the audit. The action is in accordance with the Banking Regulation Act 35A of 1949.

The Reserve Bank of India (RBI) has said that customers will be added to Paytm only after the RBI examines the report submitted by the IT auditors and gives them special approval.

Action against Paytm Payments Bank Ltd under section 35 A of the Banking Regulation Act, 1949https://t.co/tqWfwt7mT3

— ReserveBankOfIndia (@RBI) March 11, 2022

Vijay Sekhar Sharma is the founder and CEO of Paytm, which started operations in 2017. RBI had allowed Paytm to operate as a scheduled payment bank from December 2021.