PAYTM has been facing massive selling after the company’s payments bank was banned by RBI for accepting future deposits. RBI has taken an action against PAYTM payments bank for certain irregularities and PAYTM management is looking for a new banking partner to shift their clients to another bank. This could help the company to manage the frontend consumers while the backend will be supported by a reliable banking partner. However, banks are concerned that they will have to run extensive KYC checks on PAYTM customers and not many banks are willing to take up this challenging task. PAYTM is in discussion with a few banks.

It represents a big opportunity for banks to get access to a strong customer base but time will tell how this issue evolves. PAYTM stock touched another 10% lower circuit in early trade today, touching its all time lowest levels. But, there was buying at lower levels and the stock recovered quickly.

The stock was currently trading at Rs 454, up by 3.4 percent compared to yesterday’s close. The stock touched intraday high of Rs 473.55 and traders can expect that we have found a bottom for the payments service major.

PAYTM could face further issues if authorities decide to run additional checks on the company. For the moment, the selling pressure has reduced on the counter. However, fresh positions shouldn’t be initiated in this counter till the time there is a clarity on Payments Bank issue.