Paytm gets NPCI nod for TPAP, Axis Bank, HDFC Bank, SBI and YES Bank come on board

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The National Payments Corporation of India (NPCI) has granted approval to One97 Communications Limited (OCL) to participate in UPI as a Third-Party Application Provider (TPAP) under multi-bank model.

Four banks (Axis Bank, HDFC Bank, State Bank of India, YES Bank) shall act as PSP (Payment System Provider) banks to OCL. YES Bank shall also be acting as merchant acquiring bank for existing and new UPI merchants for OCL.

“@Paytm” handle shall be redirected to YES Bank. This will enable existing users and merchants to continue to do UPI transactions and AutoPay mandates in a seamless and uninterrupted manner.

OCL has been advised to complete migration for all existing handles and mandates, wherever required, to new PSP banks at the earliest.

So what exactly does TPAP do?

A TPAP or Third-Party Application Provider facilitates UPI-based payment transactions via mobile wallets, merchant apps, or any other platform that utilises UPI for payments.

NPCI owns and operates the UPI platform. TPAPs leverage UPI infrastructure and work with payment service providers (PSPs) and banks to facilitate transactions. A TPAP approval is mandatory to provide UPI-based payment transactions to customers.

Why did Paytm need TPAP?

All UPI transactions on Paytm at present are being routed through Paytm Payments Bank, registered as TPAP. As the RBI has asked the PPBL to shut its operations by March 15, there will be no TPAP registration for the Paytm app to be able to provide UPI services.

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