Noida, Apr 25 (APAC Media): The Reserve Bank of India (RBI) on April 24 cancelled the banking licence of Paytm Payments Bank Limited with immediate effect, citing serious and persistent violations of regulatory norms and concerns over depositor interest.
In an order dated April 24, 2026, issued under Section 22(4) of the Banking Regulation Act, 1949, the central bank said the payments bank is prohibited from undertaking any form of banking business. The move effectively bars the entity from carrying out activities defined under Sections 5(b) and 6 of the Act.
“RBI will make an application for winding up of the bank before the High Court,” the central bank said in a statement.
It added that the bank has sufficient liquidity to repay all its deposit liabilities during the winding-up process.
“The affairs of the bank were conducted in a manner detrimental to the interest of the bank and its depositors.” the RBI said.
It further noted that “the general character of the management was prejudicial to public interest,” highlighting continued non-compliance with regulatory requirements.
The regulator also stated that “no useful purpose would be served by allowing the bank to continue its operations,” and flagged the bank’s failure to comply with licensing conditions.
The decision follows a series of supervisory actions against the payments bank over the past few years. The RBI had directed the bank to stop onboarding new customers from March 2022. In early 2024, additional restrictions were imposed, including a ban on fresh deposits, credits, and wallet top-ups.
The latest action marks a decisive step by the RBI amid prolonged concerns over governance and compliance standards at the entity.
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