Paytm to operate as third party app for UPI

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Paytm to operate as third party app for UPI (Image: Twitter/Paytm)
Paytm to operate as third party app for UPI (Image: Twitter/Paytm)

New Delhi : One97 Communications Limited, parent company for PayTm, is currently in talks with National Payments Corporation of India (NPCI) to workout its operations as a third party application for the fintech major's Unified Payments Interface (UPI).

“Since Paytm Payments Bank will stop offering payment services, Paytm will become a third-party app going forward, integrating UPI through other lenders,” a media report quoted a person aware of the development.

People who use Paytm for UPI payments currently have virtual payment addresses (VPAs) ending in "@paytm." However, after March 1st, these VPAs might change to handles associated with different banks.

This change is because Paytm's UPI service operates under Paytm Payments Bank Limited (PPBL). Due to restrictions imposed by the Reserve Bank of India (RBI), PPBL is unable to accept new deposits after February 29th.

Therefore, Paytm is planning to partner with three or more banks to issue new VPAs to its customers. According to reports, Axis Bank, HDFC Bank, and Yes Bank are potential partners.

It's important to note that 22 different third-party app providers (TPAPs) already offer UPI services, including companies like Amazon Pay, Google Pay, and PhonePe. Additionally, Axis Bank, HDFC Bank, and ICICI Bank already support multiple fintech companies through this third-party model.