Thursday, 20 January 2022

RBI imposed a ₹1 crore fine on Paytm Payments Bank Limited

RBI imposed a ₹1 crore fine on Paytm Payments Bank Limited

On Wednesday, the Reserve Bank of India imposed a monetary fine of ₹1 crore on Paytm Payments Bank Limited (PPBL) over a particular specified breach.

On examination of Paytm Payments Bank Limited (PPBL) application for final Certificate of Authorization, the RBI observed that Paytm Payments Bank had submitted information that did not reflect the factual position, the central bank said in a statement.

"As this was an offense nature mentioned to in Section 26 (2) of PSS Act.

A notice was provided to Paytm Payments Bank Limited (PPBL). After reviewing the written reply and oral submissions made during the personal hearing, RBI determined that the charge above was substantiated and warranted the imposition of a monetary penalty," RBI added.

RBI imposed a 1 crore fine on Paytm Payments Bank Limited 1Twitter image : @Paytm

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Furthermore, the central bank also imposed a fine of over ₹27 lakh on cross-border inbound service operator Western Union Financial Services Inc (WUFSI) for 'for non-compliance with certain provisions of the directions contained in the Master Direction on Money Transfer Service Scheme (MTSS Directions) dated February 22, 2017.'

RBI said in a statement.

"This action is based on lack in regulatory compliance and is not intended to pronounce upon the validity of a transaction. An agreement entered into by the entities with their customers,"

Western Union Financial Services Inc (WUFSI) reported instances of breach of the ceiling of 30 remittances per beneficiary during the calendar years 2019 and 2020 and applied to compound the violation.

It said.

"RBI determined that aforementioned non-compliance warranted the imposition of monetary penalty after analyzing the oral submissions, and compounding applications, made during the personal hearing,"

It has also imposed a penalty of ₹ 27.8 lakh on reported instances of breach of the ceiling of 30 remittances, a money transfer service, for breaching the top of 30 remittances per beneficiary during calendar year of 2019, 2020.

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