The Confederation of All India Traders (CAIT) has released a warning to traders nationwide who utilize Paytm, advising them to transition to alternative payment methods. The Reserve Bank of India (RBI) has imposed specific limitations, prompting CAIT to suggest that users take preemptive steps to safeguard their funds and maintain smooth financial transactions.
The Confederation of All India Traders has asked traders to switch from Paytm to other payment apps, after the Reserve Bank of India ordered Paytm Payments Bank to stop services over alleged violations of norms. #Paytm #CAIT pic.twitter.com/sF8NEaCQze
— Debanish Achom (@debanishachom) February 4, 2024
In a press release, CAIT expressed concern about the potential financial disruption faced by a significant number of small traders, vendors, hawkers, and women who rely on Paytm for their transactions, given the RBI restrictions on the platform.
The CAIT National President B.C. Bhartia and Secretary General Praveen Khandelwal have expressed concerns about the security and continuity of financial services provided by Paytm due to recent restrictions imposed by the RBI. CAIT believes that any evidence of fund irregularities should be investigated by the Enforcement Directorate (ED).
Khandelwal highlighted the importance of risk mitigation for traders, advising them to explore alternative payment applications that comply with regulatory guidelines. He pointed out that one major reason for the RBI’s restrictions on Paytm Payment Bank was the creation of numerous accounts without proper identification and incomplete Know Your Customer (KYC) processes. Transactions involving large sums without proper identification have raised concerns about potential money laundering.