RBI ends Paytm Payments Bank license: Will your UPI still work?

UPI payments, wallets and Paytm transactions continue to run in focus after the Reserve Bank of India (RBI) on April 24 cancelled the banking licence of Paytm Payments Bank, while clarifying that deposits will be repaid during the winding-up process.

What it means for your UPI, wallet and payments

One 97 Communications Limited (Paytm) said its services will continue to operate without interruption, despite the RBI action against Paytm Payments Bank.

In its filing, the company said: “No services provided by the Company are in partnership with PPBL. Additionally, PPBL operates independently, with no board or management involvement from the Company.”

“There is no direct financial impact on the Company since, as previously disclosed, the Company had already impaired its investment in PPBL as of March 31, 2024,” the company further clarified.

Paytm added that all major services will continue, including the Paytm app, Paytm UPI, Paytm Gold, Paytm QR, Paytm Soundbox, Paytm card machines, Paytm Payment Gateway and Paytm Money.

RBI cancels Paytm Payments Bank licence

The central bank also said it will make an application for winding up of the bank before the High Court.

Why RBI took the action

RBI said the decision was taken due to repeated regulatory non-compliance and concerns over governance.

“The affairs of the bank were conducted in a manner detrimental to the interest of its depositors,” the central bank stated.

“The general character of the management of the bank is prejudicial to the interest of depositors as also the public interest… no useful purpose or public interest would be served by allowing the bank to continue,” it further added.

The bank was also found non-compliant with provisions of the Banking Regulation Act, 1949.

What happens to your money

RBI said Paytm Payments Bank has sufficient liquidity to repay all its deposit liabilities during winding up.

It noted that the bank “has enough liquidity to repay its entire deposit liability upon winding up of the bank.”

Customer deposits are expected to be returned through the winding-up process.

Earlier restrictions on the bank

The RBI had already imposed restrictions over time, including stopping new customer onboarding from March 11, 2022.

It later restricted deposits, credits and wallet top-ups in existing accounts and prepaid instruments, and directed a comprehensive IT system audit.

Paytm Payments Bank will cease banking operations following RBI’s order, while Paytm says its UPI, wallet and payment services will continue independently and remain operational for users.

Paytm informs exchanges on winding up of Paytm Payments Bank; says no impact on operations

One 97 Communications Limited has informed BSE and NSE that Paytm Payments Bank Limited (PPBL) will undergo winding up after the Reserve Bank of India cancelled its banking licence effective April 24, 2026. In a disclosure dated April 25, 2026, the company said PPBL’s Board and shareholders have approved resolutions to initiate the process as per regulatory directions.

The company clarified that the development is not expected to have any material impact on its business, operations, or financial condition, and stated it has no exposure or material arrangements with PPBL. It added that services including the Paytm app, UPI, Paytm Gold, QR, Soundbox, payment gateway, and other offerings will continue uninterrupted.