The Reserve Bank of India (RBI) has recently cancelled the banking licence of the Paytm Payments Bank Limited, citing “financial irregularities”. The existing customers, however, would be able to withdraw their deposits according to the RBI rules that sets a timeframe for returning depositors’ money. What are payment banks? A payment bank is a small-scale bank, mostly operate through mobile apps and supervised by the RBI. How are these banks differ from regular banks like SBI and HDFC? No Loans: A payment bank doesn’t provide loans or issue credit cards. Deposit Limit: Currently, limited to a maximum of ₹2 lakh per customer. Are payment banks riskier? Payment banks can pose a risk to depositors’ money like any other large-sized commercial banks. However, if a bank fails or loses its license, the Deposit Insurance and Credit Guarantee Corporation (DICGC) offers protection to depositors’ money. DICGC insures the deposits, which include savings, FDs and current accounts. How much money is insured? Each customer is insured for up to ₹5 lakh per bank account What it covers: This limit includes both the principal and the interest amount. So, even if a payment bank collapses, the account holder’s money is safe up to ₹5 lakh per account and withdraw it from their bank accounts. Airtel Payments Bank is the market leader in the segment: As of April 2026, the Airtel Payments Bank, with a large customer base, is a market leader in the segment. Savings A/C Interest Rates of Payment Banks in India Steps to delete or close your Paytm bank account: Deactivating your Paytm payments bank ATM debit card: To deactivate the debit card, follow the steps below: Post navigation Netflix to have reels-like feed:Scroll to find your next show
