Paytm Must Reapply for Digital Banking Payments License in India

Paytm Lending Unit

In an effort to make sure digital payment transactions are regulated in India, the country’s reserve bank has issued a request for digital payments banking platform Paytm Payments Bank to reapply for its license to operate in India.

A Saturday (Nov. 26) press release detailed the Reserve Bank of India’s request to the payments company, finding Paytm must resubmit its payments banking operations application after its parent company, One97, gains the necessary approvals to be in line with foreign investment guidelines.

The company stressed that the request “has no material impact on our business and revenues as we will continue to service our existing online merchants,” and Paytm can continue to onboard new offline merchants.

Per the release, Paytm has 120 days to resubmit the application, but can still add offline merchants as users of its banking payments aggregation platform in the meantime.

The company has recently been making changes to its executive team, bringing Deependra Singh Rathore on as the new interim CEO when previous CEO Satish Gupta retired in October.

At the time, a spokesperson from Paytm said of the shift, “We are focused on bringing the best of technology-driven banking to drive financial inclusion. As we continue our journey, we are excited to strengthen our leadership team and have seasoned experts from banking and financial services join us.”

Having strong leadership is key when leading a digital banking payments platform, as the demand for digital payments is trending positive.

A recent PYMNTS report, “How Consumers Use Digital Banks,” found that 36% of consumers are highly interested in using a digital bank in the next year, which indicates a growing demand for the services that Paytm offers through its platform, and why it is critical for the company to get its license in India as soon as possible to meet growing demand.