The Reserve Bank of India (RBI) earlier this week ruled out a review of its decision to impose strict restrictions on the business of
Paytm
Payments Bank. The apex bank's comments ruling out a review of the curbs will put to end any speculation in the market as some players were expecting a relaxation of sorts, following Paytm CEO and other top officials meeting with
RBI
officials and finance minister last week.
Why RBI gave one month notice to Paytm
On one month notice to Paytm, Das said that RBI gave one month to Paytm to ensure that customers don't face too much of inconvenience. "The priority is to ensure that customers do not face any inconvenience. That is why we gave one month for the transition," Das said.
"Act when we don't see effective action"
"We take all decisions after a lot of discussion, after much consideration. We look at all the aspects, weigh the pros and cons and the angularities. It is done after discussion with the regulated entity... Sometimes these discussions go on for months, at times for two-three years, with any regulated entity. We act when we don't see effective action," RBI
governor Shaktikanta Das
told reporters after a post-budget meeting of the central board, which was addressed by finance minister Nirmala Sitharaman.
Rubbishes claims that action against RBI will hurt fintech industry
Das dismissed claims of some startup founders that the regulatory action against RBI will impact the entire fintech space and innovation. "RBI has always supported fintech and sought to encourage its growth and it wants it to grow. Fintech sector has a very crucial role because it has lakhs and crores of customers. There are several facilities - money can be kept in a wallet, there may be depositors in a payment bank. Customer interest and financial stability are of prime importance. In a regulated environment you have to follow the regulations to run your business," he said.
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