The National Payments Corporation of India (NPCI) has given the green light to One97 Communications Limited (OCL), the parent company of Paytm, to migrate its users to new payment service providers (PSPs) for the Unified Payments Interface (UPI). This move is set to enhance the UPI functionality for Paytm users, and here’s what it means for you.
Smooth Transition to New UPI Handles
If you’re a Paytm user with an existing ‘@Paytm’ UPI handle, you can now create a new virtual payment address (VPA) or UPI handle associated with one of the designated partner PSP banks. These banks include State Bank of India (SBI), Axis Bank, HDFC Bank, and YES Bank.
OCL has initiated the process of transitioning ‘@paytm’ handle users to these four PSP banks, as Paytm operates under a multi-bank model as a third-party application provider (TPAP) on the UPI platform.
Improved UPI Experience
The migration to new PSP banks is expected to enhance your overall UPI experience with Paytm. By partnering with multiple banks, Paytm aims to provide a more seamless and reliable UPI service, ensuring faster and more efficient transactions.
Compliance with RBI Guidelines
The move also aligns with the Reserve Bank of India’s (RBI) guidelines, which advised NPCI to consider OCL’s request to become a TPAP for the continued UPI operation of the Paytm app.
Understanding PSP Banks and TPAPs
A PSP bank, either through its own application or a TPAP, onboards and registers customers on the UPI platform, linking their bank accounts to their respective UPI identifications or handles.
A TPAP is a service provider that participates in UPI through a PSP bank, as defined by NPCI, the governing body for the UPI ecosystem in India.
Wider Choice of UPI Handles
With the migration to new PSP banks, you’ll have the option to choose from a wider range of UPI handles based on the partner bank’s handle format. For instance, customers using PhonePe for UPI transactions have their VPAs issued through financial institutions like YES Bank, ICICI Bank, and Axis Bank, with their UPI handles ending in @ybl, @ibl, or @axl, respectively.
What It Means for You
As a Paytm user, the migration to new PSP banks means you can expect an enhanced and more reliable UPI experience. With multiple banks handling the UPI transactions, you’ll benefit from improved transaction speeds, reduced failure rates, and better overall efficiency.
Additionally, the migration ensures compliance with regulatory guidelines, ensuring the continued and uninterrupted use of the Paytm app for your UPI needs.
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