OCL said that this arrangement is expected to seamlessly replace the nodal account that the firm was using with Paytm Payments Bank.
Paytm Payment Services (PPSL), wholly owned subsidiary of the company has already been using the Axis Bank services, since its inception.
“Both OCL and PPSL are also in discussions with other banks to evaluate a second partner for nodal/escrow services,” the company stated in the press release.
Consumer payments for merchant transactions are typically collected in a dedicated account. This arrangement enables Paytm to seamlessly transition its merchants’ settlements to Axis Bank, thereby facilitating business operations for the merchants, it added.
Meanwhile, the company stated, “Paytm QR, soundbox and card machines will continue to work even beyond March 15, confirms RBI.”
On Friday, the Reserve Bank of India announced an extension of the deadline for Paytm Payments Bank until 15 March 2024, a shift from the initial date of 29 February 2024. This extension applies to certain restrictions imposed on 31 January 2024.
Paytm Spokesperson, said, “We are committed to providing seamless service to our merchant partners, with focus on compliance and regulatory guidelines. We assure our users that the Paytm app, and our pioneering devices like Paytm QR, Soundbox, Card Machine will continue to work as always. The shift of the nodal account to Axis Bank (by opening an Escrow Account) will ensure seamless merchant settlements as before."
One 97 Communications is the digital financial services firm which operates under the Paytm brand. Paytm is India's payment super app offering consumers and merchants comprehensive payment services.
The company had reported a consolidated net loss of Rs 221.70 crore in Q3 FY24 as against a net loss of Rs 392.10 crore posted in Q3 FY23. Revenue from operations jumped 38.23% to Rs 2,850.5 crore in the quarter ended 31 December 2023 from Rs 2,062.2 crore recorded in the same period last year.