In a significant move impacting millions of users, Paytm, India's leading digital payments platform has been coordinating an essential transition by shifting its nodal account to Axis Bank.
This manoeuvre, as disclosed in a regulatory filing, aims to ensure uninterrupted operations of essential services like Paytm QR, Soundbox, and card machines post the March 15 deadline set by the Reserve Bank of India (RBI).
The decision comes amid regulatory concerns and operational adjustments for Paytm Payments Bank Ltd (PPBL).
Following the RBI's directive, Paytm has been compelled to accelerate the migration process for its vast user base.
Paytm, with over 30 crore users and a network of 1 crore merchants, faces the intricate task of facilitating a seamless transition while sustaining its market presence.
A Times of India report quoted a Paytm representative as saying, "The shift of the nodal account to Axis Bank (by opening an Escrow Account) will ensure seamless merchant settlements as before."
A Business Standard article reports that industry insiders anticipate the migration process could span three to six months.
The report further said that Paytm's endeavour to secure a third-party application provider (TPAP) license from the National Payments Corporation of India (NPCI) aligns with its strategy to sustain digital payment capabilities, particularly through the Unified Payments Interface (UPI).
Notably, discussions are underway between Paytm and other major banking entities like HDFC Bank and State Bank of India (SBI) to ensure continued UPI services for users.
The RBI's recent extension of the deadline for PPBL's operational restrictions till March 15 provides a brief respite for users and merchants to adapt to the impending changes