Paytm Payments Bank has been barred from signing up new clients by the RBI, and the business has been ordered to perform IT audits

The Reserve Bank of India has ordered Paytm Payments Bank Ltd to cease accepting new clients immediately, citing “some serious supervisory concerns,” according to the central bank. The RBI has also requested that One 97 Communications Ltd’s Paytm Payments Bank Action employ an IT audit company to undertake a thorough System Audit of its IT system. “The Reserve Bank of India has today, in the exercise of its powers, inter alia, under section 35A of the Banking Regulation Act, 1949, instructed Paytm Payments Bank Ltd to cease onboarding of new clients with immediate effect,” it said in a statement released on Friday. “Paytm Payments Bank Ltd’s onboarding of new clients will be subject to particular clearance from RBI, which will be given after examining the IT auditors’ report,” the statement continued. Paytm Payments Bank is a joint venture run by Vijay Shekhar Sharma, with One97 Communications Ltd owning a 49 percent ownership and Paytm founder Sharma holding the remaining 51 percent. According to the Paytm website, it is the country’s largest digital bank, with over 58 million account holders. According to a Moneycontrol story, the business was anticipated to file for a small financing bank (SFB) license by June. The bank is anticipated to reach five years of operation by June, making it eligible to apply for an SFB license, according to the newspaper.

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