The primary reason for verification (Know Your Customer/KYC) on Paytm is to fulfill the legal requirements set by the Reserve Bank of India (RBI):

• Regulatory Compliance: Verification is mandatory under the Prevention of Money Laundering Act (PMLA), 2002, ensuring service providers identify and verify their customers.
• Combating Financial Crime: It is the essential tool to prevent platforms from being used for money laundering and terrorist financing, ensuring all transactions are traceable.
• Security and Trust: Verification protects users by confirming identity and mitigating fraud, which is necessary for a trusted financial ecosystem.

Verification Status for Paytm Services

The verification requirement applies differently to current Paytm services:

• For UPI Transactions: Full KYC is NOT mandatory for UPI payments. Basic verification is needed during account setup to successfully link your KYC-compliant bank account.
• For Paytm Wallet: Paytm Wallet operations are currently restricted or unavailable. Previously, different levels of KYC were required to fully utilize the wallet's features (like maintaining a large balance or sending money to a bank).