The Reserve Bank of India on Friday said it has cancelled the banking licence issued to Paytm Payments Bank. The licence was cancelled as the “affairs of the bank were conducted in a manner detrimental to the interest of the bank and its depositors”, the RBI said in a statement.
“The general character of the management of the bank is prejudicial to the interest of depositors as also the public interest,” it said. Consequently, Paytm Payments Bank is prohibited from conducting any “banking” business, it added.
The RBI also said it will file an application before the high court to wind up the bank. “Paytm Payments Bank Limited has enough liquidity to repay its entire deposit liability upon winding up of the bank,” it said.
Paytm Payments Bank has been barred from onboarding new customers with effect from March 11, 2022.
Bandhan Bank, Muthoot Housing Finance Company penalised
The Reserve Bank on Friday said it has imposed a Rs 41.8 lakh penalty on Bandhan Bank for non-compliance with certain norms, including directions on Know Your Customer. While imposing a penalty on Bandhan Bank, the RBI said the bank failed to carry out periodic review of risk categorisation of certain categories of accounts and had sanctioned director-related loans.
“The action is based on deficiencies in statutory and regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers,” the RBI said.
In another statement, the central bank said it has slapped a penalty of Rs 80,000 on Muthoot Housing Finance Company for non-compliance with certain directions issued by the RBI on “Fair Practice Code”.
In this case also, the RBI said, the penalty is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the company with its customers.
Also read: Supply chain disruptions may pose challenges: RBI bulletin
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