Paytm Collaborates With Axis Bank, Paytm QR; Soundbox Will Keep Working
Paytm Payments Bank, a part of the Paytm company, has faced regulatory action from the Reserve Bank of India (RBI) due to non-compliance with regulations.
The RBI initially ordered the bank to stop accepting new deposits by February 29, which was later extended to March 15.
Paytm has shifted its nodal account to Axis Bank to ensure merchant settlements continue smoothly.
The RBI has allowed customers and merchants some extra time to make alternative arrangements before the restrictions take full effect.
After March 15, no new deposits or transactions will be allowed in customer accounts, wallets, FASTags, or other payment instruments linked to Paytm Payments Bank.
Customers can still use the funds in their accounts but cannot add more money after the deadline.
Paytm’s popular products like QR codes for payments and FASTag for toll collections will continue to work if linked to accounts other than those of Paytm Payments Bank.
The bank’s non-executive chairman has tried to appeal the RBI’s decision, but the central bank has stated that there will be no review of the action taken.
In response to the regulatory scrutiny, Paytm’s parent company has found a new banking partner to help sustain its operations and navigate through the current crisis. The company has also clarified that its QR codes, soundbox, and card machines will remain operational beyond March 15.
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Axis Bank is already linked with Paytm rival PhonePe. Axis Bank and PhonePe have been partners since February 2021, allowing PhonePe users with Axis Bank accounts to create and use multiple UPI IDs with the “@axl” handle.
This partnership offers benefits such as choosing specific Axis Bank accounts for transactions, ensuring business continuity, and providing flexibility in managing finances.
The integration between the two entities ensures smooth and secure transactions, enabling users to utilize PhonePe’s features like bill payments and online purchases with their Axis Bank accounts.
The partnership of Axis Bank with Paytm and PhonePe aims to enhance the digital payment experience, promote UPI adoption, and offer convenience in financial management.
These collaborations will help both UPI platforms in UPI payments and multi-bank support, after the closing of Paytm Payments Bank.
