PhonePe services hit as partner Yes Bank put under moratorium

New Delhi, March 6 (SocialNews.XYZ) Payment services provider PhonePe has suffered an outage after the Reserve Bank of India (RBI) on Thursday put the bank under moratorium.

In a tweet, PhonePe said that its services are temporarily unavailable as it is going through an unscheduled maintenance activity.

"We are temporarily unavailable. We are going through an unscheduled maintenance activity. We apologise for any inconvenience this may cause. We'll be back soon," it said.

Sameer Nigam, founder CEO of the company, however, confirmed that the outage is a result of placement of Yes Bank under the moratorium.

"Dear @PhonePe_ customers. 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. We hope to be live in a few hours. Thanks for your patience. Stay tuned for updates," Nigam tweeted.

The apex bank on Thursday evening placed the bank under moratorium for 30 days and capped the withdrawals from Yes Bank at Rs 50,000. It also superseded the board of directors of the private lender for 30 days and appointed former SBI CFO Prashant Kumar as the bank's administrator.

The RBI said the financial position of Yes Bank Ltd has undergone a steady decline, largely due to the bank's inability to raise capital to address potential loan losses and resultant downgrades, triggering invocation of bond covenants by investors, and withdrawal of deposits.

The bank has also experienced serious governance issues and practices in the recent years which have led to its steady decline.

The development has also caused somewhat panic among a section of Yes Bank account holders who rushed to the ATMs after the RBI announcement and many reportedly found that ATMs had run out of cash.

Source: IANS