Paytm Taps Axis Bank for Nodal Account, Securing QR, Soundbox, Card Machine Services

html

Representative image

Fintech giant One97 Communications, the company behind the popular brand Paytm, has made a strategic move by shifting its nodal account from Paytm Payments Bank to Axis Bank. This decision aims to ensure the uninterrupted continuation of Paytm QR, Soundbox, and card machine services beyond the March 15 deadline set by the Reserve Bank of India (RBI).

RBI's Directive and Paytm's Response

The RBI recently issued a directive advising customers and merchants of Paytm Payments Bank Ltd (PPBL) to transfer their accounts to other banks by March 15. This decision came as a result of the bank's inability to comply with regulatory requirements. To address this challenge, Paytm has taken proactive measures to minimize disruptions for its users.

Escrow Account for Seamless Merchant Settlements

As part of its contingency plan, Paytm has opened an escrow account with Axis Bank. This account will facilitate seamless merchant settlements, ensuring that businesses continue to receive payments without any interruptions.

Paytm Payment Services Ltd's Existing Relationship with Axis Bank

Paytm Payment Services Ltd (PPSL), a wholly-owned subsidiary of One97 Communications, has been utilizing Axis Bank's services since its inception. This existing relationship between the two entities further strengthens the transition process.

Nodal Account: A Central Hub for Transactions

The nodal account serves as a central hub for all customer and merchant transactions within Paytm's ecosystem. By shifting this account to Axis Bank, Paytm aims to maintain the smooth functioning of its payment services.

Continued Functionality of Paytm QR, Soundbox, and POS Terminals

In its FAQs, the RBI has clarified that Paytm QR code, Paytm Soundbox, and Paytm POS terminals will continue to operate after March 15, provided they are linked to other banks instead of PPBL.

Paytm's decision to shift its nodal account to Axis Bank demonstrates its commitment to ensuring uninterrupted services for its customers and merchants. By proactively addressing the RBI's directive, Paytm has taken necessary steps to maintain the seamless functioning of its payment ecosystem beyond the March 15 deadline.