RBI has prohibited Paytm Payments Bank from making new customers. After this, Macquarie has released its report about One97 Communications. One97 Communications is the parent company of Paytm Payments Bank. Let us know what Macquarie has said in his report.
Business will not be affected much
Macquarie has said that the RBI’s decision will not have much impact on Paytm’s business. Paytm is one of the largest fintech companies in the country. Paytm was listed in the stock markets last year. Macquarie has said that RBI’s move may set aside efforts to convert Paytm Payments Bank into a small finance bank.
Paytm brand may get hurt
“We do not expect the RBI’s move to have much impact on Paytm’s business. This is because Paytm has already been able to create a large customer base for its payments bank,” the report said. This is expected to have an impact on the Paytm brand. It may also impact customer loyalty going forward.”
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There will be problem in getting license of SFB
Industry sources also justified Macquarie’s view. He said, “Business is not going to be affected much as the transaction value does not depend on the new customers. But, this move of RBI has come at a bad time as it shows the lack of trust of RBI in Paytm. This comes at a time when Paytm is about to seek banking license from RBI.”
Macquarie said the new developments have reduced the chances of Paytm Payments Bank to transform itself into a small finance bank. Paytm Payments Bank had said that it would apply for a banking license with RBI in March this year. Moneycontrol had reported about this on 9 March.
More than 16 percent market share in UPI
Paytm Payments Bank offers all types of products that belong to Paytm. These include UPI as well. Paytm has a 16 per cent share in the UPI market. Paytm Wallet has more than 33 crore accounts. According to the report, the ban on the creation of new customers of Paytm Payments Bank means in a way a ban on the creation of new customers of Paytm.
What has RBI said?
On March 11, the Reserve Bank banned Paytm Payments Bank from adding new customers. Along with this, RBI has ordered to conduct IT audit of Paytm Payments Bank. The meaning of IT audit is that the company’s IT infrastructure i.e. software is able to bear the burden of many customers, what are the flaws in it and why they are coming, all these will be investigated.
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