Paytm Gets Green Light to Onboard New UPI Users, But There’s a Catch!

New Delhi, October 23 – After months of waiting, Paytm has finally received approval from the National Payments Corporation of India (NPCI) to onboard new UPI users. This decision comes as a relief to Paytm, which had been restricted by the Reserve Bank of India (RBI) from adding new users since January 2023. However, the approval comes with several conditions, ensuring that Paytm must strictly follow all NPCI guidelines and comply with any updates issued from time to time.

Earlier this year, RBI imposed a ban on Paytm Payments Bank, citing non-compliance with KYC regulations, which halted the platform’s ability to bring on new UPI users or accept new deposits. Paytm had to rely on third-party banking partners like SBI, Axis Bank, HDFC Bank, and Yes Bank to facilitate UPI transactions.

According to the filing submitted by Paytm to the stock exchange, NPCI has now given the green signal, but with the caveat that the company adheres to all legal and regulatory frameworks. Paytm had previously submitted a request to NPCI on August 1, seeking permission to resume onboarding new users.

With NPCI's approval in hand, Paytm can breathe a sigh of relief, though the road ahead involves maintaining strict compliance. Despite the setbacks, Paytm continues to operate its UPI services via partnered banks, positioning itself as a third-party application provider.

This development marks a significant comeback for Paytm, but they will have to walk a fine line to keep regulators happy!

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