After Yes Bank was placed under moratorium, a number of startups including payment firms PhonePe and BharatPe, face outages till April 3 reports Entrackr.com
While Rahul Chari, Founder & Chief Technology Officer (CTO) of PhonePe wrote on Twitter that the company was first starting “disbursal of PhonePe merchant settlements', Livemint reports that the payments platform has confirmed that it’s resuming operations within the next few hours.
It can be noted that Yes Bank's own net banking facilities have not been operational since Thursday evening. Other fintech operators, who rely on Yes Bank to settle their transactions, are also down.
“We sincerely regret the long outage. Our partner bank (Yes Bank) was placed under moratorium by RBI. Entire team's been working all night to get services back up asap (as soon as possible),” the app's chief executive Sameer Nigam on Friday. He added that PhonePe- one of the most popular interfaces for UPI transactions- hopes to be live in a “few hours”.
PhonePe, one of the country's largest digital payment platforms, and the largest payments partner of Yes Bank, is dependent on the bank to process its transactions.
PhonePe’s competitor BharatPe’s users too faced the same issues. However, BharatPe’s services were only partially hit, as it has ICICI Bank as its other banking partner, reports Entrackr.com. The two fintech companies contribute to a major chunk in Yes Bank’s UPI volume.
Livemint reports that Yes Bank’s UPI handles have been shut down by the National Payments Corporation of India, which theoretically affects all platforms who used Yes Bank as their UPI partner. According to NPCI’s website, that includes companies like Flipkart, Jabong, Myntra, RedBus, PVR, MakeMyTrip, Cleartrip and more.
Bhim said in its official Twitter handle 'Hi, NPCI is acting as a platform for processing transaction. A successful transaction cannot be reversed, unless the beneficiary refunds at his own end. We request you to get in touch with your bank for further assistance.'
However, partners who have tie ups with multiple banks will not be affected. A spokesperson at Swiggy said the startup has multiple payments partners, because of which consumer payments can still go through and haven’t completely gone down.
For consumers, if your UPI account was made using a Yes Bank UPI handle, then the same should have stopped working.
Yes Bank was placed under a moratorium on Thursday evening, with the RBI capping deposit withdrawals at Rs 50,000 per account for a month and superseding its board.
The bank will not be able to grant or renew any loan or advance, make any investment, incur any liability or agree to disburse any payment.
The State Bank of India (SBI) and the Life Insurance Corporation of India (LIC) are set to pick up 49 per cent stake in Yes Bank NSE -56.11 % by acquiring preferential shares in the private lender at Rs 2 per share, reports ET Now.
For the next month, Yes Bank will be led by the RBI-appointed administrator Prashant Kumar, an ex-chief financial officer of State Bank of India (SBI).
The moratorium issued on Yes Bank could affect fintech startups significantly at least for this month. According to reports, the bank accounted for 39% of all UPI transactions in the country, said Livemint.