Paytm Likely Secured As Third-Party App Provider For UPI

13 Mar 2024 , 11:47 AM

One 97 Communications, is expected to receive a third-party application provider (TPAP) license from the National Payments Corp of India (NPCI) by March 15, according to news reports.

Customers can still use the Paytm app to make payments through India’s well-known unified payment interface (UPI) thanks to the third-party application provider license, even if the company’s banking division, Paytm Payments Bank, must shut down by March 15 as a result of regulatory action brought on by non-compliance issues.

Users can transfer money between banks via India’s real-time payments system, UPI, which is run by the NPCI.

“The (TPAP license) approval will come before March 15 and most of the checks have been completed,” according to one of the reports.

“While the integration with banks may take more than a month, the license approval should be in place before the deadline ends.”

Paytm is probably going to collaborate with Axis Bank, HDFC Bank, State Bank of India, and Yes Bank to handle UPI transactions, according to a report from Reuters last month.

Based on data accessible on the NPCI website, Paytm, the third-largest UPI payment app in the country, processed 1.41 billion monthly transactions worth ₹1.65 Lakh Crore in February, down from 1.57 billion transactions valued at ₹1.93 Lakh Crore in January.

In India, the two most popular UPI payment apps are PhonePe and Google Pay.

“Paytm’s UPI transactions took a hit in February, largely due to a blow on the brand’s reputation, but once TPAP license is approved, transaction volumes are expected to pick up,” according to a report. “Paytm is regularly meeting NPCI to obtain the TPAP license.”

One of the aforementioned reports stated that they are unlikely to see the central bank extend the deadline of March 15th for Paytm Payments Bank to cease operations.

In response to a Reuters email requesting comment, the RBI did not immediately react.

Paytm Payments Bank will not take any new deposits into its wallets or accounts after March 15.

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