The Employee Provident Fund Organisation (EPFO) has announced that it will, from February 23, block deposits and credits into EPF accounts linked with Paytm Payments Bank Limited (PPBL).
This move of EPFO comes in little over a week after the Reserve Bank of India (RBI) announced restrictions on Paytm Payments Bank from February 29.
The central bank has prohibited any deposit, credit transactions, or top-ups in customer accounts of PPBL after February 29.
In a circular issued on Thursday, EPFO directed its field offices to not accept claims associated with PPBL accounts.
“All the field officers are advised to refrain from accepting claims associated with bank accounts in Paytm Payment Bank w.e.f February 23, 2024. A wide publicity should be initiated to raise awareness about this change”, EPFO circular said.
It maybe recalled that EPFO had last year permitted EPF payments to be made in accounts of Paytm Payment Bank and Airtel Payments Bank.
RBI decision
The RBI’s decision of January 31 to restrict PPBL’s operations came in the wake of non-compliance issues despite repeated warnings by the central bank.
“No further deposits or credit transactions or top ups shall be allowed in any customer accounts, prepaid instruments, wallets, FASTags, NCMC cards, etc. after February 29, 2024, other than any interest, cashbacks, or refunds which may be credited anytime,” RBI had said.
RBI Governor Shaktikanta Das had post the recent MPC Policy meeting said that central bank gives sufficient time to every entity to comply and sometimes more than sufficient time to the entities for compliance. “If they would comply, why would a regulator like us would have to take action?” he asked.
At the same time, RBI also maintained that it is not against the growth of fintech ecosystem in India.