Reserve Bank of India (RBI) has on Friday, in the exercise of its powers, inter alia, under section 35A of the Banking Regulation Act, 1949, directed Paytm Payments Bank Ltd to stop, with immediate effect, onboarding of new customers. The bank has also been directed to appoint an IT audit firm to conduct a comprehensive System Audit of its IT system.
Onboarding of new customers by Paytm Payments Bank Ltd. will be subject to specific permission to be granted by RBI after reviewing the report of the IT auditors.
This action was based on certain material supervisory concerns observed in the bank. The action was taken against Paytm Payments Bank Ltd. under section 35 A of the Banking Regulation Act, 1949.