CAIT seeks clarification from RBI over Paytm Payments Bank restrictions

In response to recent developments surrounding Paytm Payments Bank and the actions taken by the Reserve Bank of India (RBI), the Confederation of All India Traders( CAIT) in a communication sent today to Shaktikanta Das, RBI Governor seeking clarification on certain key concerns to ensure transparency and address potential risks for consumers and stakeholders.

Following RBI Governor Shri Shaktikanta Das' definitive statement of no review on Paytm issue and reports of an ongoing investigation by the Enforcement Directorate into Paytm Bank, there has been a growing apprehension among the trading community and small businesses, who constitute a significant portion of Paytm's consumer base, regarding the security of their funds held with Paytm- said CAIT. 

CAIT National President B C Bhartia & Secretary General Praveen Khandelwal in communication to Das said that trading community fully supports the measures undertaken by the RBI, we respectfully request clarification on specific irregularities related to Paytm. The RBI's decision to bar Paytm Payments Bank from conducting further activities, effective from February 29, 2024, underscores the need for clarity on issues such as the Know Your Customer (KYC) process, alleged related party transactions, and complex shareholding within Paytm.

Both trade leaders said that It is imperative to address concerns raised by the RBI regarding Paytm's compliance with regulatory guidelines, transaction security, financial stability, consumer protection measures, and adherence to industry regulations. As such, CAIT urges the RBI to provide detailed clarification on these matters to ensure the safety and trust of consumers and investors alike.

Bhartia and Khandelwal said that we believe that the RBI's action serves as a timely reminder for stakeholders to exercise caution and diligence when engaging with fintech platforms such as Paytm. Transparency, compliance, and accountability are paramount in maintaining the integrity of the digital payment ecosystem and safeguarding the interests of all stakeholders.

CAIT remains committed to promoting consumer awareness and advocating for regulatory transparency in the fintech sector. We encourage users to stay informed about any updates or developments related to the RBI's actions on Paytm and to take necessary precautions to mitigate associated risks.