On February 26, Finance Minister Nirmala Sitharaman along with the deputy governor of Reserve Bank of India (RBI) and the other top officials of stakeholder ministries—from finance, information technology (IT), and Department for Promotion of Industry and Internal Trade (DPIIT)—are scheduled to meet the heads of fintech companies in New Delhi.
This meeting is in the wake of RBI’s regulatory action against Paytm’s banking arm Paytm Payments Bank. On the government’s agenda, fintech and innovation in fintech stand as the topmost priority. This is followed by digital payments being a mainstay of its social sector programmes, stated a media report.
The meeting is to reassure the fintech industry that the sector would be the focus of priority for the government. Furthermore, the meeting is also to put concerns at rest in view of RBI’s recent action against Paytm Payments Bank. What the government intends to highlight to the fintech companies is that a single action by RBI against a particular entity stemmed from the very actions of that company.
On January 31, the Reserve Bank of India (RBI) clamped down on the operations of Paytm Payments Bank, and restricted it from accepting deposits, top-ups, or extending credit services from February 29.
Following the RBI’s restrictions on Paytm Payments Bank in January, confusion ensued about the platform’s future services. Last week, the RBI released FAQs clarifying the situation.
Twenty-five percent of the merchant base at Paytm is in the process of migrating to Google Pay, PhonePe, BHIM application app, as per reports. And, this is likely to increase. In other parts of the country, Paytm’s competitors are making efforts to win over merchants.
The FAQs released by RBI have extended the deadline to March 15 for restrictions on deposits and credit transactions. It has been clarified that merchants can accept payments via Paytm QR code, soundbox, or PoS terminal even post March 15. This is possible if the transfer of funds is linked to any other bank apart from Paytm Payments Bank.
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