In March, Paytm Payments Bank faced significant disruptions in its services following unprecedented action by the Reserve Bank of India (RBI). As of February 29th, users will no longer be able to fund their wallets, Fastag, or add funds to their accounts. However, withdrawals and transfers are still permitted.
Government regulations mandate every four-wheeler to display a FASTag on the windshield, a system operated by India’s National Highway Administration (NHAI) for automatic toll collection. Toll booth payments utilize prepaid wallets and Radio Frequency Identification (RFID) technology.
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The RBI’s actions may impact those with Paytm Payments Bank accounts linked to their UPI. Deposits are accepted until February 29th, and the funds can be spent freely. UPI addresses linked to other banks remain unaffected.
The RBI stated, “No further deposits or credit transactions or top-ups shall be allowed… after February 29, 2024,” affecting prepaid instruments, wallets, FASTags, and NCMC cards.
Merchants acquired by Paytm Payments Bank cannot accept payments as accounts cannot be replenished. However, many have QR stickers from other companies, allowing them to still accept digital payments.
Transferring money from the wallet to a bank account is recommended. Paying utility or phone bills with the remaining funds is also an option.
Paytm is no longer authorized by the RBI to accept specific prepaid instruments, impacting NCMCs and food and fuel wallets. Until February 29th, existing funds can be used.
To switch issuers for a new Paytm FASTag, customers must deactivate their existing tag. Paytm does not provide these loans directly, and borrowers are obligated to repay third-party lenders. Late or nonexistent repayments can impact credit scores.
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For disabling Paytm FASTag:
- Open the Paytm app and sign in.
- Search for “FASTag” and go to “Services,” then choose “Manage FASTag.”
- View linked FASTag accounts under “Help & Support.”
- Select “Queries related to updating FASTag profile.”
- Choose “I want to close my FASTag” and follow on-screen instructions .