The Reserve Bank of India (RBI) has cancelled the banking license of Paytm Payments Bank Ltd, effective immediately, due to concerns over management practices that are detrimental to the interests of depositors. The RBI stated that the bank failed to comply with Section 22 (3) of the Banking Regulation Act, which mandates that banking operations must not harm depositors' interests. Consequently, the RBI will file for the bank's winding up in the High Court. Despite the cancellation, the RBI assured that depositors' funds are safe, as most had already withdrawn their deposits since the bank was barred from accepting new ones in February 2024 due to ongoing compliance issues. This is not the first time Paytm Payments Bank has faced regulatory actions; it was previously restricted from onboarding new customers in March 2022 and faced additional business restrictions in early 2024. The parent company, One97 Communications, saw its shares drop by 1%, closing at ₹1147 on the Bombay Stock Exchange following the announcement.