RBI cancels banking licence of Paytm Payments Bank
Mumbai (PTI): The RBI on Friday announced the cancellation of banking licence issued to Paytm Payments Bank for non-compliance with norms, saying the affairs of the bank were conducted in a manner detrimental to the interest of its depositors.
The Reserve Bank of India (RBI) will make an application for winding up of the bank before the high court.
The bank failed to comply with the conditions stipulated in the Payments Bank licence issued to it, the central bank said.
One97 Communications, which owns Paytm brand, in company filing said the company has no exposure to Paytm Payments Bank (PPBL) as it had already impaired its investment in the beleaguered entity as of March 31, 2024.
PPBL, was an associate firm of Vijay Shekhar Sharma-promoted fintech firm Paytm, came under the regulatory scanner on multiple occasions earlier, including in March 2022 when the central bank barred it from onboarding new customers.
The licence was cancelled effective from the close of business hours on Friday, the Reserve Bank of India (RBI) said, adding that Paytm Payments Bank has enough liquidity to repay its entire deposit liability upon winding up.
The RBI said the affairs of the bank were conducted in a manner detrimental to its own interests as well as its depositors.
"The general character of the management of the bank is prejudicial to the interest of depositors as also the public interest... no useful purpose or public interest would be served by allowing the bank to continue...," the RBI said in a statement.
Paytm Payments Bank was not complying with certain norms of the Banking Regulation Act, 1949, it added.
According to the central bank, Paytm Payments Bank Ltd is prohibited from conducting the business of "banking" or any additional business specified under the Banking Regulation Act with immediate effect.
Paytm Payments Bank started operations as a payments bank with effect from May 23, 2017. The Reserve Bank had issued a licence to the bank to carry on the business of payments bank in the country.
The bank has been under the RBI lens over the past many years.
Paytm in the regulatory filing cited disclosure dated March 1, 2024 and said it does not have any exposure to PPBL or any material business arrangements with PPBL.
"No services provided by the Company are in partnership with PPBL. Additionally, PPBL operates independently, with no board or management involvement from the Company. There is no direct financial impact on the Company since, as previously disclosed, the Company had already impaired its investment in PPBL as of March 31, 2024," the filing said.
Paytm said its services will continue uninterrupted.
The services include the Paytm app, Paytm UPI, Paytm Gold and all other services offered by its subsidiaries and associated companies such as Paytm QR, Paytm Soundbox, Paytm card machines, and Paytm Payment Gateway, Paytm Money among others.
Earlier, PPBL was directed to stop onboarding new customers with effect from March 11, 2022 amid "material supervisory concerns" observed in the bank.
The bank was also directed to appoint an IT audit firm to conduct a comprehensive system audit of its IT system.
Thereafter, on January 31, 2024 and February 16, 2024, certain business restrictions were also imposed on the bank, including disallowing any further deposits/credits/ top-ups in existing customer accounts, prepaid instruments, and wallets.
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Choose faith or future: BJP alleges 'second-class treatment' of Hindus in K'natka CET row
New Delhi (PTI): The BJP on Saturday accused the Karnataka Congress government of being "anti-Hindu" and following double standards after students appearing for the Common Entrance Test (CET) were allegedly asked to remove their 'janeu'.
A political row erupted after five Brahmin students were allegedly forced to remove the thread, considered sacred and worn across the torsos, at a city college in during the CET on Friday.
Students alleged that the invigilators at Madivala asked them to remove their janeu/yajnopaveetha if they wanted to write the exam.
In a video post on X, BJP national spokesperson Shehzad Poonawalla lambasted the act.
"Is it a crime to be a Hindu in Karnataka? In Karnataka, students were stopped from entering the examination hall for wearing a janeu and were given a brutal option -- choose your faith or your future. This happened last year as well," Poonawalla alleged.
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He accused the Karnataka government of practising double standards and engaging in appeasement politics.
"In Karnataka, we have seen the politics of appeasement. Muslim reservation, a Muslim-only budget, and quotas and contractual work for Muslims. But Hindus have to remove their sacred thread if they want to take an exam, which even the courts have, by the way, allowed," he alleged.
He accused the Congress government of adopting a similar approach in other states where it is in power, while allowing hijab and burka in classrooms.
"It has happened in various Congress-ruled states. We have seen that the Congress party advocates the right to hijab and burkha within the classroom. They say this should be allowed. Even the courts have overruled it.
"But in the case of janeu, they want it to be removed. This is not the first time this has happened. In Telangana and other states, the tilak and mangalsutra were removed. But hijab is fine. This is the kind of second-class treatment being given to Hindus," he added.
Poonawalla said the Congress should rename itself from INC to "MMC -- Muslim League Maowadi Congress" or the "Islamic National Caliphate Party".
As the controversy took a political turn, the college suspended the invigilator pending inquiry. The government also ordered a probe.
The police registered a case and detained three staff members of Krupanidhi College who were in charge of examination checking for questioning, officials said.
A similar incident took place last year in Karnataka, following which the government directed that the candidates would not be asked to remove the janeu while appearing for the CET.
