There is important news for Paytm Payments Bank customers: the Reserve Bank of India (RBI) has removed Paytm Payments Bank Limited (PPBL) from the list of regulated banks. RBI announced this on October 7. However, this decision was not sudden; the central bank had been conducting reviews of the bank for several years due to regulatory violations, and its banking license had previously been revoked.
RBI stated that PPBL was excluded from Schedule II of the Reserve Bank of India Act, 1934. The corresponding notification was issued on July 31, 2026, and published in the official gazette of India on September 7. Simply put, banks included in Schedule II are called regulated banks, and they are subject to rules and regulatory systems established by the RBI. PPBL is now absent from this list.
RBI's actions against PPBL began many years ago. In March 2022, RBI prohibited the bank from onboarding new customers, citing serious concerns regarding the supervision of the bank's operations. The central bank also required a comprehensive audit of the bank's IT systems involving an external auditing firm. Despite this, the bank received no relief, and in 2024, RBI tightened restrictions.
In January 2024 and February 2024, RBI imposed a series of operational restrictions on PPBL. The bank was prohibited from accepting new deposits, loans, or top-ups into customer accounts, wallets, and other prepaid instruments. Thus, the stringency of the bank's operations gradually increased. RBI's actions also affected the bank's general banking services.
The most severe blow to PPBL came when RBI revoked its banking license. After this, the future of the bank became clearer. Later, the Delhi High Court also ordered the commencement of the liquidation (winding up) process for Paytm Payments Bank. PPBL is a company associated with Paytm, and the founder of Paytm is Vijay Shekhar Sharma.
The exclusion of Paytm Payments Bank Limited from the RBI's list of regulated banks is seen as a continuation of a long-term regulatory campaign against it. It is important for customers to note that PPBL already faced restrictions on acquiring new customers, accepting new deposits, and topping up wallets. Furthermore, the bank's license was cancelled, and there is already a court order regarding the liquidation process. According to the RBI notification dated October 7, it is now clear that PPBL is no longer on the list of regulated banks.