Best Paytm Payment Bank Alternatives

The Reserve Bank of India (RBI) recently announced the suspension of Paytm Payments Bank, citing “persistent non-compliance and continued material supervisory concerns” identified during an audit. 

What Happened to Paytm Payments Bank?

According to sources familiar with the matter, the RBI audit discovered an alarming flow of money and data between Paytm Payments Bank and its parent company, raising accounting and supervisory concerns. Despite warnings from the RBI, these issues still needed to be solved. 

Additionally, the regulator expressed concerns about overlapping management, where executives held decision-making positions in both entities, potentially leading to conflicts of interest.

For those unaware, in October 2023, Paytm Payments Bank faced regulatory action for non-compliance with Know Your Customer (KYC) regulations. The authorities cited the bank’s failure to identify the beneficial owners of entities utilizing its payout services.

Additionally, the bank was found negligent in monitoring such transactions and conducting proper risk assessments for these customers. The RBI discovered that Paytm Payments Bank had also been guilty of exceeding regulatory limits. The bank violated the permissible end-of-day balance for specific customer advance accounts associated with payout services.

It also delayed cybersecurity reporting, with the bank exhibiting a concerning delay in reporting a cybersecurity incident, raising questions about its ability to adequately address security threats.

Also Read: Best App To Invest In Mutual Funds In India

Top Paytm Payment Bank Alternatives in India!

This ban on the Payments Bank from Paytm has users worried. If you are one such user of Paytm’s facilities, worry not, since there are lots of alternatives in the market for you. 

1. Airtel Payments Bank

Established in 2016, Airtel Payments Bank stands out as a pioneer in the digital banking realm. Licensed by the Reserve Bank of India, it caters to modern banking needs with a comprehensive suite of services. Users benefit from seamless bill payments, secure savings accounts, instant money transfers, and diverse financial products.

For enhanced security, Airtel Safe Pay safeguards online transactions, ensuring complete control over finances. The bank simplifies account opening through Video KYC, requiring only an Aadhaar card and an active mobile number. Additionally, a digital wallet empowers users to manage finances, conduct recharges, pay bills, shop offline, send money, and make online payments across various platforms.

Airtel Payments Bank offers zero-balance savings accounts, eliminating minimum balance requirements. Users can leverage UPI features and earn interest on their savings, credited monthly. The interest rate varies based on the balance, reaching up to 7% for specific amounts.

Furthermore, Airtel’s Rewards123 program provides cashback benefits on various transactions, including mobile recharges, online purchases, and bill payments. This program adds another layer of value for users seeking to maximize their financial gains.

In conclusion, Airtel Payments Bank positions itself as a strong contender in the digital banking arena, offering a convenient, secure, and rewarding experience for its customers.

2. Jupiter

Jupiter emerges as a compelling contender in the digital banking landscape, offering a zero-balance savings account in partnership with Federal Bank. Marketed as an all-encompassing solution, the Jupiter app empowers users to manage their finances seamlessly. From round-the-clock customer support to a convenient digital KYC process via video call, Jupiter prioritizes user experience.

The app boasts an array of functionalities, including QR code scanning, credit card payments, and cashback rewards on both UPI and non-UPI transactions. Users can gain valuable insights into their spending habits through the integrated tracking feature. Additionally, Jupiter offers a complimentary EDGE CSB Bank RuPay Credit Card and a free VISA debit card for everyday transactions.

Standing out from competitors like Paytm Payments Bank, Jupiter’s robust rewards system allows users to earn “Jewels” on their spending, redeemable for cash or gold. The platform leverages partnerships with established financial institutions like Axis Bank, NPCI, RuPay, and VISA to ensure secure and reliable transactions.

Beyond everyday banking, Jupiter caters to investment needs, enabling users to invest in gold, mutual funds, and fixed deposits with competitive interest rates reaching up to 7.5%. Furthermore, the bank offers tiered interest rates on savings accounts, with rates increasing as the balance grows.

Also Read: How to Transfer Amazon Pay Balance To Bank Account

3. Fi Money

Fi Money is a payments management platform that lets you open an online savings bank account, UPI payments, Mutual funds, Loan and invest in US stocks. You even get a digital VISA debit card, and you can even request for physical debit card. The Fi Money app is well-built and is one of the best Paytm Payment Bank alternatives.

4. NSDL Payments Bank

NSDL Payments Bank, with its NSDL Jiffy platform, offers simplified banking solutions to all Indians. Operating under a license granted by the Reserve Bank of India, the bank focuses on providing core banking services through a convenient digital platform.

NSDL Payments Bank offers competitive interest rates, with 2.5% per annum on balances up to Rs 1 lakh and 5% on balances exceeding Rs 1 lakh. Users receive a free virtual debit card, while physical debit cards incur an annual fee of Rs 300 plus GST. Transaction charges are minimal, with free intra-bank and NEFT transfers, and a nominal fee structure for other transactions.

NSDL Jiffy emphasizes a paperless and queue-free experience, allowing users to open accounts, transfer funds, pay bills, and make investments seamlessly through the app. This user-centric approach, coupled with RBI approval, positions NSDL Payments Bank as a reliable alternative to Paytm Payments Bank.

Also Read: How Can You Open an Airtel Payment Bank Account without Airtel SIM

5. Kotak’s 811

Perhaps the most enticing on our list comes from the renowned Indian bank, Kotak. The Kotak 811 Zero Balance Savings Account is different from the regular Kotak bank account and can be opened entirely online. It provides 4% interest p.a. on savings account balances above Rs 50 lakhs and 3.50% interest p.a. on savings account balances up to Rs 50 lakhs. However, there are no reward schemes available with this bank account.

Kotak 811 account holders can transfer funds for free online using NEFT, IMPS, or RTGS. They can also easily shop online using either their Virtual Debit Card (VDC) or their physical debit card. However, please note that the physical debit card has an annual fee of Rs 299. It’s worth noting that the bank is RBI-approved and offers an FD facility with an interest rate of up to 7%. You can easily make payments using 811.

It’s important to note that other options exist in the digital banking space, such as Fi Money and IndusInd zero balance savings accounts. Exploring these alternatives can help you choose the banking solution that best aligns with your specific needs.

Also Read: Make Google Pay, PhonePe, PayTm UPI Payments Without Internet

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