Paytm FASTags will become inoperative after February 29 as the Reserve Bank of India (RBI) has barred Paytm Payments Bank from offering services from next month.
“Travel hassle-free with FASTag! Buy your FASTag today from below authorised banks,” Indian Highways Management Company (IHMCL), the electronic tolling arm of National Highways Authority of India (NHAI), said on its official X (formerly twitter) handle along with a list of 32 banks that did not include Paytm Payments Bank.
The move is aimed at ensuring that millions of Paytm FASTag users do not face any hassle while using toll roads after the cut-off date, people aware of the matter told ET.
The government is apprehensive of the inconvenience that will be caused to Paytm FASTag users, they said.
However, “no bank is willing to board Paytm FASTag users as of now”, one of the sources said. “The only option left for such customers is to cancel the Paytm FASTag and buy new ones from any of the banks (listed by IHMCL),” the person told ET.
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India has over 70 million FASTag users and Payments Bank claims it has 30% market share, which means more than 20 million users. Paytm FASTag users can continue to use it to pay tolls until they run out of balance, but they cannot recharge them. A query sent to Paytm Payments Bank did not elicit any response till the press time Thursday.
IHMCL, in a letter dated January 19, 2024, barred Paytm Payments Bank from issuing fresh FASTags and taking up new toll plazas due to non-compliance with mandatory know your customer (KYC) norms.
While the Reserve Bank of India governor Shaktikanta Das has said that the central bank will not review its decision against Paytm Payments Bank (PPBL) as it comes after a comprehensive assessment, the IHMCL wants easier and hassle-free migration of Paytm FASTag users to other bank FASTags.
The banks it has authorised for issuing FASTags include Airtel Payments Bank, Allahabad Bank, AU Small Finance Bank, Axis Bank, Bank of Baroda, Bank of Maharashtra, Canara Bank, Central Bank of India, City Union Bank, Cosmos Bank, Equitas Small Finance Bank, Federal Bank, FINO Payments Bank, HDFC Bank, ICICI Bank, IDBI Bank, IDFC First Bank, Indian Bank, IndusInd Bank, J&K Bank, Karnataka Bank, Karur Vysya Bank, Kotak Mahindra Bank, Nagpur Nagarik Sahakari Bank, Punjab National Bank, Saraswat Bank, South Indian Bank, State Bank of India, Thrissur District Cooperative Bank, UCO Bank, Union Bank of India, and Yes Bank.