The State Bank of India declared a strategic partnership with Paytm’s parent organisation One97 Communications for its UPI payments which will start functioning from today. Since the Reserve Bank of India imposed a series of restriction on the payments bank. Quite a long since the One97 Communications has been trying to enter into partnerships to become a third-party application provider.

On 23^rd February, RBI instructed the customer and merchants to seamlessly transfer their fund, from PPBL to a set of newly identified banks to avoid any disruption. Paytm is also planning with Axis, Canara, Yes and Kotak Mahindra Bank.

Third party apps are heavily dependent on PSP banks when it comes to the speed of the payments or even ensuring that payment failures are kept to a minimum. Its competitors like Phonepay, Google pay has partnered with atleast with three banks.

Payment Payment Bank has the largest beneficiary bank in the UPI ecosystem over the last three years with over 20% market share in inbound credit transactions. Paytm is the third-largest app for UPI payments in the country. It processed 1.41 billion monthly transactions worth Rs 1.65 lakh crore ($19.94 billion) in February.

One of the sources said, "The TPAP license approval will come before March 15 and most of the checks have been completed. While the integration with banks may take more than a month, the license approval should be in place before the deadline ends."

TPAPs are responsible for complying with guidelines prescribed by both NPCI and their partner PSPs (banks) and facilitate RBI, NPCI, and other agencies to access their data, information, and systems with respect to UPI transactions. About 22 entities, including Amazon Pay, Google Pay, Mobikwik, PhonePe, and WhatsApp, currently have a TPAP licence.

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