Paytm Crisis: Users find it difficult to move their main PPBL-linked accounts to Paytm Money

Paytm Crisis: Users find it difficult to move their main PPBL-linked accounts to Paytm Money

Payments using PayTM Bank account holders have complained that the brokerage platform, which is allegedly proactive about the newest improvements to support a seamless transfer for consumers, is making it difficult for them to move bank accounts. are imparting correct education.

Following the RBI's February 29 prohibition on PPBL's ability to take deposits or authorize credit transactions, customers will now need to establish an additional main bank account.

Many investors and merchants are perplexed by the continuing Paytm Payments Bank Limited (PPBL) turmoil and are finding it difficult to transfer their default PPB accounts to another bank using the Paytm Money app.

Paytm Money, Groww, Zerodha, Upstox, and other online stock brokerages allow customers to connect their trading or demo accounts to numerous banks, including PPBL.

This main bank account is used to withdraw money from the trading account (dividend credit for the shares they own) and to add money to the platform before buying equities.

Users will now need to create another main bank account, since the RBI has prohibited PPBL from taking deposits or enabling credit transactions after February 29.

Many users, however, allege that the choice is banned for them on the app and are still stuck in the process.

Groww said that it was in talks with CDSL to resolve the problem, while Paytm Money released a statement stating that it is collaborating with stakeholders to guarantee a seamless transition.

A central securities repository in India called Central repository Services Limited, or CDSL, assists shareholders and investors in keeping their shares and other marketable instruments in electronic form.

Online brokerages, or depository participants, serve as a conduit between the principal bank account and the dividends paid by users on shares, which are dispersed by CDSL.

Zerodha will make a special effort to notify its clients who haven't unmapped it themselves of the upgrade till the following week.

We are in positive talks with asset management companies (AMCs) as mutual fund registrars and transfer agents (RTAs) to improve the process of changing your default bank account. Once everything is finalized, we'll keep you informed of our progress," Paytm Money said in a blog post on February 3.

What took place

Users of Paytm Money are having trouble switching bank accounts despite their best attempts.

"I have my mutual fund SIP auto-debit default account set to PPBL. Every time I attempt to shift banks, it informs me that the change in default mandate has been momentarily halted and requests that I try again later. It's been over a week, and they keep assuring me they're working on it, two people said.

An additional account user reported that, after successfully registering a new bank account, he was still unable to modify the mutual fund investments' default bank (PPB).

Social media was used by many others to voice similar worries.

"PPB is the default account, and I used Paytm Money to invest in mutual funds. I've made several attempts to alter it. What would happen to my money in the event that the bank closes? A user asked, "How can I redeem the funds?"

According to a top industry expert, switching main bank accounts is common procedure and shouldn't cause too many issues.

If the client submits the modification request and the necessary documentation, the broker is obligated to move the bank account. They are unable to refute it. It may be a CDSL problem, or their (Paytm Money) backend system isn't set up to handle it, he stated.

Another representative of a brokerage business said that internet broking firms just serve as a technological platform and that CDSL technically updates bank account modifications.

"This PaytmPayments issue is exclusive to one bank. It could take some time since there are some problems with the CDSL side of the account transfer, he stated.

Some Groww users expressed dissatisfaction at having to convert their PPBL accounts via an offline procedure that required them to submit a request form by mail.

Brokers said that after speaking with CDSL, this was resolved.

"Now, clients may choose Groww as the automated provider for their demat bank account opening. We are alerting our clientele of this, the representative said.

Zerodha has reportedly been managing the process well in the meantime and has refrained from disclosing the total number of PPB account holders on its system.

"No issue exists. Our clients are able to map another Paytm account and unlink their current one. In the next week, a Zerodha representative said, "We will also inform customers who haven't unmapped it themselves and linked it to another bank account."

According to him, customers may still transfer to PPBL after the credit deadline of February 29 but will need to open new accounts in order to make withdrawals.