Paytm Payments Bank’s independent director Manju Agarwal steps down in response to RBI’s limits

Manju Agarwal, an independent director of Paytm Payments Bank, resigned from the board on February 1, 2024, in response to PPBL limits imposed by the Reserve Bank of India (RBI), according to a report by CNBC-TV18.

Paytm Payments Bank was subject to significant business restrictions on January 31 by the RBI, which included a ban on taking new deposits and credit transactions after February 29.

Significant anomalies in KYC were discovered by the regulator, putting customers, depositors, and wallet owners at grave danger.

Additionally, the regulator discovered a remarkably high quantity of inactive accounts that might have been exploited as mule accounts. Deficits in the KYC procedures and the absence of a transaction monitoring system in the bank raise additional worries about money laundering.

The payments bank has been instructed by the RBI to settle all pipeline transactions and nodal accounts by March 15; after that date, no more transactions will be allowed.

The RBI was forced to cease operations by February 29 due to continuous non-compliance with regulations, and the banking regulator believes that this is a reasonable time to cancel the permission. Although it is doubtful that a similar instance will recur, Moneycontrol noted on February 6 that the Paytm Payments Bank problem is likely to force current payment banks exercise prudence in their operations.