Paytm Payments Bank Limited (PPBL) will begin its banking operations from May 23, 2017. As per the Central bank’s guidelines, the company will transfer its wallet business to the newly incorporated payments bank entity under a payments bank licence awarded to Founder and CEO Vijay Shekhar Sharma.
What is Paytm Payments Bank Limited (PPBL)?
Paytm Payments Bank is a separate service being offered by Paytm which will be integrated into the Paytm app, and you don’t need a separate app. Customers using the payment wallet will automatically move to the Paytm Payments Bank Ltd, with the same amount of money in their wallets, and have the option of discontinuing their wallet services by communicating the same before 23 May.
What will Happen to Paytm?
Nothing will happen to Paytm, as they will only turn into a Payments Bank from a Digital Wallet. They will remain the same, with some new added features.
What Will Happen to the Money in my Paytm Wallet now?
The money will stay as it is, only it’s ownership will get transferred on 23rd May from Paytm Wallet to Paytm Payments Bank.
How Does it Work?
Once the service is launched, you will get an invite to open a separate Paytm Bank account. Anyone wishing to open an account will have to go through the mandatory know your customer (KYC) compliance. Proper documents such as Aadhaar and permanent account number (PAN) will be required to open the account. Paytm will also offer interest on the money in the bank, not the wallet.
How is a payments bank different from the usual bank?
A payments bank cannot lend or give advance to customers. It can issue cheque books and debit cards but not credit cards. There is a limit on the money you can keep in your account. You cannot keep more than Rs 1 lakh in the Paytm payments bank. The purpose behind these banks is to provide quick and basic banking services to the people at the bottom. Airtel too is launching a payments bank.
Will I get a Cheque Book, Debit Card and Other Features like Normal Bank?
Yes, you can get a Cheque Book, Virtual Debit Card but no Credit Card. Though you will get interest on your money.
What if I have not been a regular Paytm user?
For users who have not used their Paytm wallets for over six months or have zero balance in their wallets, Paytm will not switch the wallet to Payment Wallet. Such users will have to specifically give consent over app, web or email for the conversion.
“As per RBI guidelines, your Paytm Wallet will soon be transferred to the newly incorporated Paytm Payments Bank. Till now they were issued by One97 Communications Limited. This will happen automatically, and Paytm users do not need to do anything additional. Our customers will continue to use all the services provided by the Paytm Wallet, and enjoy all the benefits . Log in details, wallet balance and user experience will remain the same,” Paytm said in a blog post.
Sources: BGR, Trak, Quint, Economics times, Paytm