The Reserve Bank of India (RBI) has removed Paytm Payments Bank Ltd (PPBL) from the list of scheduled banks following the cancellation of its banking licence over regulatory non-compliance.
In a statement, the central bank confirmed that PPBL had been excluded from the Second Schedule of the Reserve Bank of India Act, 1934. The notification was issued on July 31 and published in the Gazette of India in September.
The Second Schedule contains the list of banks recognised as scheduled banks under the RBI Act. Inclusion in the list provides eligible banks with certain operational privileges under the regulatory framework.
The development follows the RBI’s decision in April 2026 to cancel PPBL’s banking licence. The central bank said the bank’s affairs had been conducted in a manner detrimental to its own interests and those of its depositors. The Delhi High Court subsequently ordered the winding up of the bank.
PPBL, an associate company of Paytm promoted by Vijay Shekhar Sharma, had faced several regulatory restrictions over the past few years.
In March 2022, the RBI barred the bank from onboarding new customers after identifying what it described as “material supervisory concerns”. It also directed PPBL to appoint an information technology audit firm to conduct a comprehensive review of its IT systems.
Further restrictions followed on January 31 and February 16, 2024. The RBI barred the bank from accepting additional deposits, credits and top-ups in existing customer accounts, prepaid instruments and wallets.
The latest exclusion from the scheduled banks list marks another step following the cancellation of PPBL’s banking licence. The action follows the regulator’s concerns over the bank’s compliance with regulatory requirements and the protection of depositor interests.
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