India’s leading digital payment platform, Paytm, is strategically considering partnerships with Axis Bank, HDFC Bank, State Bank of India (SBI), and Yes Bank to facilitate Unified Payments Interface (UPI) transactions, according to sources familiar with the matter. This move comes amidst regulatory challenges, with the Reserve Bank of India (RBI) directing Paytm Payments Bank to wind down its operations by March 15, causing disruptions to the popular payment app.
The partnership aims to leverage the UPI system, operated by the National Payments Corporation of India (NPCI), enabling seamless money transfers across banks. Paytm’s quest to onboard reputable banking partners underscores its commitment to sustaining operations and serving its vast user base efficiently.
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While the regulatory environment remains uncertain, discussions are underway to onboard banking partners, with an emphasis on large institutions capable of handling substantial transaction volumes seamlessly. However, official statements from HDFC Bank, Yes Bank, SBI, and Paytm are awaited, while Axis Bank and NPCI declined to comment.
The process involves a meticulous examination of the bank’s technological capabilities and infrastructure by NPCI, a task expected to take about a month. Once finalized, Paytm users will transition to an updated UPI handle associated with the partner bank, ensuring continuity and reliability of services.
With Paytm ranking as the third-largest app for UPI payments in India, processing 1.6 billion monthly transactions, this strategic partnership holds significant implications for the digital payments landscape. Amid regulatory directives, banking entities like Yes Bank express readiness to engage with Paytm, subject to clarity on associated risks and commercial viability.
In navigating regulatory challenges, Paytm’s collaboration with leading banks underscores its resilience and commitment to providing seamless digital payment solutions to millions of users across India.
