In response to restrictions by the Reserve Bank of India (RBI) on Paytm wallet usage and bank activities, the Confederation of All India Traders (CAIT) on Sunday recommended traders to move from Paytm to alternative payment apps for business-related transactions.
"The Reserve Bank of India has implemented certain regulations, leading CAIT to advise customers to adopt preemptive steps to safeguard their money and guarantee ongoing financial activities. Because so many women, small business owners, hawkers, and vendors use Paytm to make payments, RBI restrictions on the platform could cause financial hardship for these individuals, according to the CAIT.
RBI orders to Paytm
The RBI's new restrictions on Paytm have prompted concerns about the security and continuity of the platform's financial services, according to CAIT Secretary General Praveen Khandelwal.
To minimize any possible negative consequences on their financial activities, he advised traders to take quick action and make well-informed decisions.
"The RBI clamped down on tech poster boy Vijay Shekhar Sharma-run entities due to concerns about money laundering and dubious transactions involving hundreds of crores of rupees between the popular wallet Paytm and its less well-known banking arm," PTI reported, citing sources.
Paytm Payments Bank Ltd (PPBL) has been directed by the RBI to cease the majority of its operations, which includes receiving deposits, extending credit, and topping up any client accounts, prepaid devices, wallets, and cards used to pay road tolls after February 29. Customers using Paytm wallets can spend money up until their remaining balance. Add-ons are not permitted after February 29.
Furthermore, if the RBI does not budge, Paytm wallet top-ups will end and transactions will no longer be possible.
Paytm Payments Bank Limited is a partner of One97 Communications Limited (OCL). One97 Communications owns 49 percent of PPBL's paid-up share capital, both directly and through its subsidiary. Vijay Shekhar Sharma holds a 51% stake in the bank.
Image Source: Paytm
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