Paytm Payments Bank has reportedly temporarily disabled international transactions on its debit cards till further notice.
“People having debit cards will no longer be able to initiate international transactions using debit cards till further notice… We understand that this may impact your financial activities, and we sincerely apologize for any inconvenience this may cause to you,” Paytm said in an email sent to customers, as per Entrackr.
The payments bank neither disclosed the reason for the temporary ban nor specified any timeline for the resumption of the service.
A mail sent to the company seeking comments on the development didn’t elicit any response till the time of publishing this story. The article will be updated on receiving a response.
The development comes barely a week after the Reserve Bank of India (RBI) imposed a fine of INR 5.39 Cr on Paytm Payments Bank for non-compliance with Know Your Customer (KYC) and cybersecurity norms.
Paytm Payments Bank began issuing Visa debit cards to its customers in March 2020. Initially, the company offered only digital cards but eventually began offering physical Visa cards as well. It also issues debit cards to customers in partnership with state-backed card network RuPay.
Despite being a positive proposition for parent One97 Communications, Paytm Payments Bank has been under the radar of the central bank for over a year now. In March 2022, the RBI barred Paytm Payments Bank from onboarding any new customers over ‘certain material supervisory concerns’.
In its latest update, the company said it has already implemented RBI’s various recommendations as part of an IT review undertaken in the previous fiscal year. While the central bank is yet to take a call on the matter, Paytm’s president and chief operating officer (COO) Bhavesh Gupta, in July, said he was hopeful of the restrictions being lifted by March 2024.
The regulatory hurdles for Paytm Payments Bank have been a key concern for parent One97 Communications, which has seen a dramatic turnaround in the past one year. Its consolidated net loss narrowed 44.5% year-on-year (YoY) to INR 358.4 Cr in Q1 FY24, while revenue jumped 39% to INR 2,342 Cr in Q1 FY24 from INR 1,680 Cr in Q1 FY23.
Set up in 2017, Paytm Payments Bank is one of the top payments banks in India, offering a mobile banking platform and ewallet services.
In 2022, it emerged as one of the top mobile banking service providers in India and ranked sixth globally in terms of ewallet users. Paytm owns 49% stake in the payments bank. Paytm Payments Bank reported a profit of INR 5.7 Cr on revenue of INR 2,356 Cr in FY23.
Paytm is scheduled to release its financial numbers for the July-September quarter on Friday (October 20). Its shares ended Thursday’s session 2.18% higher at INR 968.7 on the BSE.
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