Paytm, Axis Bank to jointly apply for TPAP license for UPI payments: Report
The beleaguered Paytm Payments Bank Limited earlier served as a Payments Service Provider bank for Paytm parent One97 Communications to enable UPI transactions.
Paytm parent One97 Communications and Axis Bank reportedly plan to send a joint application for a Third-Party Application Provider (TPAP) license with the National Payments Corporation of India (NPCI) to allow UPI payments post March 15.
Previously, Paytm Payments Bank Limited (PPBL) acted as a Payments Service Provider (PSP) bank for One97. PPBL itself is a bank and thus Paytm was not required to partner with another bank to facilitate UPI transactions.
With the new collaboration with Axis Bank, will be able to operate under a third-party partnership model, similar to other major UPI apps like , Google Pay, and Amazon Pay.
As the deadline imposed by the RBI on PPBL to suspend most operations approaches, NPCI is expected to expedite the process to ensure that there are no disruptions or difficulties for customers using the Paytm app for UPI payments, according to Moneycontrol.
YourStory has reached out to One97 Communications and will update the story upon receiving the respone.
Earlier, One97 Communications had transitioned its nodal account to Axis Bank from Paytm Payments Bank, it said in a regulatory filing. This was done to ensure the continuity of Paytm's essential services such as QR codes, Soundbox, and card machines, even after the March 15 deadline set by the central bank. The company is also exploring partnerships with other banks to evaluate the possibility of a second partner for nodal or escrow services, it said.
Last week, the RBI extended the deadline for PPBL to suspend accepting deposits from February 29 to March 15, 2024.
Additionally, PPBL's nodal accounts with One97 Communications Ltd and Paytm Payments Services Ltd must be terminated by February 29, 2024, with the settlement of pending transactions to be completed by March 15, 2024, RBI had said.
One97 Communications saw its shares hit the upper circuit of 5% to Rs 358.35 on the NSE on February 19, 2024. The stock exchanges had earlier lowered the circuit limit to 5% from 10%.
Edited by Kanishk Singh
