RBI Action On Paytm Payments Bank Not Impacting Merchants’ Trust, Says Survey

The crippling restrictions imposed by Reserve Bank of India (RBI) on Paytm Payments Bank (PPBL) are not impacting merchants’ trust in the payment platform, a survey has said. Gurugram-based business consulting and services company Datum Intelligence said 59 per cent of merchants continue to use Paytm and see no immediate impact from the government’s clampdown. The company surveyed 2,000 merchants who are using Paytm applications for accepting payments across 12 cities. It was carried out between February 7 and 15, Datum Intelligence said in a release.

The survey showed that 21 per cent merchants are waiting for more information and only 13 per cent are switching to other payment applications.

Datum survey also found that 76 per cent of merchants use Paytm for accepting payments, followed by 41 per cent for PhonePe, 33 per cent for Google Pay and 18 per cent BharatPe. Paytm is the preferred app for 58 per cent of the merchants surveyed followed by 23 per cent for PhonePe, 12 per cent for Google Pay and three per cent for BharatPe.

The reason behind merchants’ confidence is the fact that a Paytm representative reached out to them after the RBI decision.

“71 per cent of merchants are feeling confident to continue using Paytm for payments after a reach out by a Paytm representative. Only 11 per cent are less confident about using Paytm for payments and around 14 per cent are still looking for more information,” the Datum Intelligence survey said.

“Overall, the impact is limited on the merchant business and Paytm is engaging with merchants to reduce the damage and merchants are also waiting before deciding on alternatives,” it further said.

The RBI announced the clampdown on January 31, when it asked PPBL – an associate of One 97 Communications – to stop accepting new deposits in its accounts and its digital wallets.

It later gave a 15-day extension (till March 15, 2024) for most activities linked to Paytm Payments Bank. It also clarified that customers using @paytm UPI handles can be migrated to banks post approval from National Payments Corporation of India (NPCI).