The National Payments Corp of India (NPCI) finally has good news for Paytm.
NPCI
has granted approval to Paytm, formally known as One 97 Communications (OCL) to participate in
UPI
as a Third-Party Application Provider (TPAP) under multi-bank model. The announcement comes just a day before March 15, the deadline given to
Paytm
Payments Bank by the
Reserve Bank of India
.
The four banks that have received the approval for the same are — Axis Bank, HDFC Bank, State Bank of India and YES Bank — shall act as Payment System Provider (PSP) banks to OCL. Sources suggest that the integration with banks may take more than a month
Yes Bank shall also be acting as merchant acquiring bank for existing and new UPI merchants for OCL. “@Paytm” handle shall be redirected to Yes Bank. This will enable existing users and merchants to continue to do UPI transactions and AutoPay mandates in a seamless and uninterrupted manner. OCL has been advised to complete migration for all existing handles and mandates, wherever required, to new PSP banks at the earliest.
What third-party application provider license means for Paytm
The third-party application provider license will allow Paytm customers to continue using the Paytm app for payments through Unified Payment Interface (UPI), even after the company’s banking arm, Paytm Payments Bank, ceases operations on March 15. UPI, operated by the NPCI, allows users to transfer money across banks.
Paytm, the third-largest app for UPI payments in the country, processed 1.41 billion monthly transactions worth 1.65 trillion rupees ($19.94 billion) in February down from 1.57 billion transactions valued at 1.93 trillion in January, according to data available on the NPCI website.
