RBI Forces Shutdown: Paytm Payments Bank Ordered to Be Wound Up, High Court Appoints Liquidator
Regulatory Action and License Cancellation by RBI
The Reserve Bank of India (RBI) has formally initiated proceedings concerning Paytm Payments Bank Limited (PPBL). The central bank cancelled the banking license issued to PPBL on April 24, 2026. This decision was made under Section 22(4) of the Banking Regulation Act, 1949 ('BR Act').Following the cancellation, the RBI exercised powers conferred under Sections 38 and 39 of the BR Act. The regulator subsequently applied before the Hon'ble High Court of Delhi to initiate the winding up of PPBL. A key part of this application included proposing the appointment of a Liquidator for the institution.
High Court Directs Winding Up Under Legal Provisions
The Hon'ble High Court of Delhi issued significant orders regarding the future structure of PPBL. Based on Orders dated July 08, 2026 and July 22, 2026, the court mandated that PPBL must be wound up.The winding up process will follow specific provisions detailed in both the Banking Regulation Act, 1949, and the Companies Act, 2013. This judicial action marks a definitive regulatory step for the payments bank.
Liquidator Appointed to Oversee Operations
The High Court appointed Shri Girikumar M Nair as the Official Liquidator of PPBL. Mr. Nair is identified in the orders as the former CGM of State Bank of India, lending significant financial oversight expertise to the role.As per the judicial directive, the Official Liquidator is tasked with exercising all powers prescribed under both the BR Act and the Companies Act, 2013. This appointment means that Mr. Nair will take control of institutional authority beginning July 8, 2026.
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