Recently Paytm announced the shift of its nodal account to Axis Bank by opening an Escrow Account.
- A modification in the nodal account setup will enable merchants to sustain their acceptance of digital payments through the Paytm QR code or card machine.
- Escrow is a legal concept describing a financial agreement whereby an asset or money is held by a third party on behalf of two other parties that are in the process of completing a transaction.
- This is a temporary account as it operates until the completion of a transaction process, which is implemented after all the conditions between the buyer and the seller are settled.
- In real estate, the fund flows for the development of the housing project from any source is kept in the escrow account and the funds utilised for the same are also generated from the escrow account.
- Even the buyers of the housing units in a project transfer the home price to the escrow account and the amount is not transferred to the seller until the project is completed.
- Money, securities, funds, and other assets can all be held in escrow.
