RBI Permits Paytm Payments Bank To Operate As Scheduled Payments Bank

New Delhi: The Paytm Payments Bank has announced that it has got the RBI's approval to operate as a scheduled payments bank on December 11.

Paytm payments bank happens to be an associate entity of Paytm. With this latest development, the company's bid to expand its financial services operations has been propelled and its portfolio has been diversified.

The bank notified that it has been included in the second schedule to the Reserve Bank of India (RBI) Act, 1934.

After the announcement was made, the share price of Paytm shot up to 2.62 per cent to close at Rs.1,594.55 apiece. 

Since Paytm became a publicly-traded company after the completion of its Initial Public Offering (IPO), its share price has been going south. It is to be noted that its debut in the stock market had turned out to be dismal.

The acquisition of the scheduled bank status by the Paytm Payments bank means that it will be able to participate in government- and other large corporations-issued requests for proposal, primary auctions, fixed-rate and variable rate repos, and reverse repos, along with participation in the marginal standing facility.

Paytm payments bank will also be eligible to take part in the government's financial inclusion scheme.

With this move, the bank will also be eligible for a refinancing facility from the RBI at the bank rate. It can also acquire membership to the clearinghouse and get access to the currency storage facility.

Earlier, Paytm second quarter suffered a net loss that had widened by 8 percent to Rs. 474 crore, from Rs. 437 crore a year ago. 

The company in an exchange filing on Saturday asserted that its total income increased by 49.6 percent to Rs 1,086.4 crore during the second quarter, from Rs 663.9 crore in the same quarter of 2020-21.

On 10 December, the company's stock declined by 0.86 percent closing at Rs. 1,781.15 on the Bombay Stock Exchange (BSE).

Also read: Paytm Q2 Net Loss Widens 8 Percent To Rs 473 Crore

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