NPCI likely to grant Paytm third-party app licence this week: Report

The National Payments Corp of India (NPCI) is expected to approve a third-party application provider (TPAP) licence for Paytm, by March 15, three sources directly aware of the development said on Tuesday, reported Reuters.

The third-party application provider licence will allow customers to continue using the Paytm app for payments through India’s popular unified payment interface (UPI), even as its banking arm, Paytm Payments Bank, ceases operations by March 15, following regulatory action due to issues of noncompliance. 

UPI, operated by the NPCI, is a real-time payments system that allows users to transfer money across banks. 

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“The (TPAP licence) approval will come before March 15 and most of the checks have been completed,” one of the sources said. 

“While the integration with banks may take more than a month, the licence approval should be in place before the deadline ends.”

None of the sources wished to be identified because they were not authorised to speak to the media. NPCI did not immediately respond to a Reuters email seeking comment, while Paytm declined to comment.

New FASTag

Meanwhile, National Highways Authority of India (NHAI) stated in an advisory on March 13 that Paytm FASTag users should procure a new FASTag issued by another bank before March 13, 2024, to ensure a seamless travel experience and avoid inconvenience at toll plazas.

Additionally, the RBI Governor Shaktikanta Das has countered the flak that the banking regulator is against home grown fintechs, saying the RBI's recent order against Paytm Payments Bank (PPBL) was only against a regulated entity.

He also stated that the time offered until March 15 to move accounts and wallets to other banks is adequate, indicating that another extension is unlikely.

Also, the company, on Feb 26, announced that its founder Vijay Shekhar Sharma resigned from the board. Consequently, Srinivasan Sridhar, former chairman of Central Bank of India, Ex-IAS officer Debendranath Sarangi, former executive director of Bank of Baroda Ashok Kumar Garg, and retired IAS Rajni Sekhri Sibal joined the board as independent directors.