In response to regulatory changes and restrictions affecting Paytm Payments Bank, a significant number of FASTag customers are transitioning their accounts to HDFC Bank and Axis Bank.
This migration, prompted by recent developments including directives from the Reserve Bank of India (RBI), marks a shift in the landscape of FASTag services.
According to a senior executive from Paytm who opted to remain anonymous, the transition process has been smooth, with customers exploring multiple options for FASTag services from various banking institutions.
In compliance with RBI guidelines, Paytm Payments Bank FASTag customers will no longer be able to recharge or top up their balances after March 15, 2024. However, they can continue utilizing their existing balances for toll payments beyond this date.
To facilitate the transition, the National Payments Corporation of India (NPCI) has provided a list of 39 banks for customers to choose from, enabling them to select a bank based on their preferences.
FASTag, overseen by the National Highways Authority of India (NHAI), simplifies toll collection through Radio Frequency Identification (RFID) technology, deducting payments directly from linked prepaid or savings accounts.
In line with directives from NHAI and the Ministry of Road Transport & Highways (MoRTH), Paytm FASTag users were advised to procure a new FASTag from another bank before March 15, 2024, to avoid penalties or additional fees while using National Highways.
The regulatory landscape for Paytm Payments Bank shifted in January, with the RBI imposing significant business restrictions, including a prohibition on fresh deposits and credit transactions after February 29. This was due to major irregularities in Know Your Customer (KYC) procedures.
Subsequently, in February 2023, the RBI advised customers and merchants to transfer their accounts to other banks by March 15, allowing withdrawals or utilization of balances without restrictions beyond this date.
