Paytm Payments Services Limited (PPSL), a fully owned subsidiary of One 97 Communications, has secured in-principle authorisation from the Reserve Bank of India (RBI) to issue and manage prepaid payment instruments (PPIs), which include digital wallets. In an official document, Paytm confirmed that the RBI granted this approval on November 13 as per the Payment and Settlement Systems Act, 2007. This authorisation is conditional upon adherence to the RBI’s Master Directions on Prepaid Payment Instruments.
PPSL is required to conduct a comprehensive system audit, inclusive of a cybersecurity assessment, and submit the findings to the RBI within six months. If this timeline is not adhered to, the in-principle authorisation will automatically become void. The firm may start issuing prepaid payment instruments only after obtaining the final authorisation or Certificate of Authorisation from the central bank.
In July 2026, Paytm applied for a new PPI licence through PPSL, marking its initial move towards reinstating its wallet operations after the RBI annulled the banking licence of Paytm Payments Bank in April 2026. The company mentioned this application during its investor presentation for the June quarter, noting that introducing a wallet would enhance the diversity of its consumer payment solutions. It further stated that offering multiple payment options is beneficial for consumers.
Previously, the wallet services were offered through Paytm Payments Bank. However, following regulatory actions against the bank in 2024, customers were restricted from adding funds to their wallets, although they could still withdraw existing balances. The RBI cancelled the bank’s licence on April 24, 2026, citing failure to comply with licensing conditions and regulatory standards. The central bank also remarked that the management and operations of the bank were not in the best interest of depositors and the public.
This latest in-principle approval is a significant advancement for Paytm in its efforts to reconstruct its wallet services under PPSL. Nevertheless, the company must secure the RBI’s final authorisation before it can recommence issuing wallets.