Other businesses of Paytm also under investigation
The problems of Paytm, one of India’s largest fintech companies, are far from being resolved. Reserve Bank of India has banned all the services of Paytm Payments Bank due to ignoring the rules. At present, customers have been given time to settle their transactions only till 29th February, hence now the surveillance of investigating agencies and regulators has increased regarding its other businesses also.
The latest case is of the country’s largest security depository ‘Central Depository Services India’ (CDSL). CDSL has started investigation regarding the wealth management platform ‘Paytm Money’ of Paytm’s owner company One97 Communications.
Have you bought shares with Paytm Money?
If you have also bought stock market shares with Paytm Money or invested in any mutual fund scheme. Then you may face a big shock soon. According to ET news, CDSL has started KYC verification of customers registered on ‘Paytm Money’ following the instructions of RBI. CDSL is looking into whether the different verticals of One97 Communications have carried out the KYC process properly or not.
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According to media reports, not only CDSL, but the country’s other security depository ‘National Securities Depository’ (NSDL) is also conducting such investigations. Generally, both CDSL and NSDL conduct security audits of such platforms from time to time. KYC rules are followed more strictly in securities and money markets, because the risk of money laundering is higher here.
RBI ban has no effect on Paytm Money
RBI has imposed a ban only against Paytm Payments Bank. There is no direct impact on other services of One97 Communications including Paytm and Paytm Money. However, other investigating agencies are definitely exercising caution regarding Paytm. For example, ED is also reviewing whether money laundering has taken place in the case of Paytm or not, so that further investigation can be done on that basis.
RBI has banned Paytm Payments Bank from adding new customers from March 11, 2022. In the new ban imposed on January 31, 2024, almost all its services have been banned.