Mumbai, Apr 24 (PTI) The Reserve Bank of India on Friday said it has cancelled the banking licence issued to Paytm Payments Bank.

The licence was cancelled as the "affairs of the bank were conducted in a manner detrimental to the interest of the bank and its depositors", the RBI said in a statement.

"The general character of the management of the bank is prejudicial to the interest of depositors as also the public interest," it said.

Consequently, Paytm Payments Bank is prohibited from conducting any "banking" business, it said.

The RBI also said it will make an application to the high court to wind up the bank.

"Paytm Payments Bank Limited has enough liquidity to repay its entire deposit liability upon winding up of the bank," it said.

Paytm Payments Bank has been barred from onboarding new customers with effect from March 11, 2022. PTI NKD TRB

Banking licence cancellation over depositor protection concerns leads to prohibition on banking business and winding up action. The Reserve Bank of India cancelled the banking licence issued to Paytm Payments Bank because its affairs were conducted in a manner detrimental to the interests of the bank, its depositors, and the public interest. The bank's management was said to be prejudicial to depositor protection and public interest. As a consequence, the bank is prohibited from conducting any banking business, and the RBI stated that it will apply to the High Court for winding up. The bank was also barred from onboarding new customers with effect from March 11, 2022.