Shares of Paytm (listed as One 97 Communications Ltd) slipped 8% in early deals today after the Reserve Bank of India (RBI) cancelled the banking licence of its associate entity, Paytm Payments Bank Ltd (PPBL) on April 24. 

Paytm stock fell 8% or Rs 92 to Rs 1055.25 in the current session against the previous close of Rs 1147.10. Market cap of Paytm fell to Rs 67,546 crore on BSE. 

Paytm shareholders lost Rs 5,879 crore within minutes of opening trade. 

Total 3.14 lakh shares of the firm changed hands amounting to a turnover of Rs 33.65 crore. 

The RBI said that the "affairs of the bank were conducted in a manner detrimental to the interest of the bank and its depositors." 

In March 2022, RBI barred the bank from onboarding new customers followed by severe business restrictions imposed in January and February 2024 that disallowed further deposits or credit transactions in customer accounts.

However, Paytm issued a clarification to the stock exchanges, stating that the regulatory action would not disrupt its operations or business.

The banking regulator's directive, effective April 24, 2026, marks one of the strictest actions taken by the central bank against a payments bank.

According to the RBI’s official order, PPBL is now prohibited from carrying out any banking activities as defined under the Banking Regulation Act, 1949. The central bank has also initiated the process of winding up the bank and will approach the High Court for further proceedings.

"The Reserve Bank of India (RBI) has, vide order dated April 24, 2026, cancelled the banking licence issued to Paytm Payments Bank Limited under Section 22(4) of the Banking Regulation Act, 1949 (BR Act) effective from close of business on April 24, 2026.

"Consequently, Paytm Payments Bank Limited is prohibited from conducting the business of ‘banking’ as defined in Section 5(b) or any additional business specified under Section 6 of the Banking Regulation Act, 1949, with immediate effect. RBI will make an application for winding up of the bank before the High Court," said RBI in a statement.