Ever since the RBI diktat banning Paytm Payments Bank from February 29 was issued, the company has been losing business. As the deadline comes near, the road tolling authority has advised highway users to buy FASTags from an authorised bank and listed 32 banks sans Paytm Payments Bank, in a signal to the estimated 20-million-plus Paytm FASTag users to get new RFID stickers.
According to reports, the Enforcement Directorate (ED) has already initiated an inquiry against Paytm Payments Bank.
RBI Governor Shaktikanta Das has reiterated that all decisions taken by the central bank are carefully considered. When questioned as to whether RBI will review the decision on Paytm Payments Bank, he said a firm no.
“There is no review of the decision (on Paytm Payments Bank)” Das said.
Given the way Paytm shares have fallen in the last few days, experts suggest retail investors to stay away from the stock till the time the regulatory hurdles are over. Earlier, it was also reported that the RBI is planning to cancel the license of Paytm Payments Bank.Global broking firm Macquarie sees the stock slumping to as low as Rs 275. It is now the biggest bear on Paytm.”We cut revenues sharply as we reduce both payments and distribution business revenues (60-65% over FY25/26E). Moving payment bank customers to another bank accounts or moving related merchant accounts to other bank accounts will require KYC (Know your customer) to be done again based on our channel checks with partners, indicating that migration within RBI’s Feb 29th deadline will be an arduous task,” Macquarie analyst Suresh Ganapathy said.
Those who have been trying to catch the falling knife have burnt their fingers in the last few days.
“We are trying to catch a falling knife, as we say in market parlance, and it is always avoidable. As far as Paytm is concerned, the RBI direction has pretty much stopped the business of the payments bank. There is a whole lot of uncertainty. Some meetings are happening, but how far if at all remedial actions are approved by the regulator is a big question mark. As things stand today, customer confidence, and partner confidence obviously for obvious reasons have eroded completely. There is a clamour amongst customers and partners to move out,” said Sudip Bandyopadhyay of Inditrade Capital.
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