The Reserve Bank of India (RBI) has imposed a monetary penalty on two payment system operators in regards to deficiencies in regulatory compliance.
According to a statement released by the RBI on 20th october sayes that , “The Reserve Bank of India (RBI) had, by an order dated October 01, 2021, imposed a monetary penalty of Rs1 crore (Rupees one crore only) on Paytm Payments Bank Limited (PPBL), for an offence committed of the nature referred to in Section 26 (2) of Payment and Settlement Systems Act, 2007 (PSS Act).”
The statement Further mentions that “ “A Compounding Order dated October 7, 2021, was also issued to Western Union Financial Services Inc (WUFSI), a Money Transfer Service – cross-border inbound service (customer to customer only) operator – imposing a penalty of ₹27,78,750 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.”
The RBI further clarifies that during examination of PPBL’s application for issue of final Certificate of Authorisation (CoA), it was found that PPBL had submitted information that did not reflect the factual position.
The RBI also stated that the Western Union Financial Services (WUFSI) had reported instances of breach of the ceiling of 30 remittances per beneficiary during the calendar years 2019 and 2020 and filed an application for compounding of the violation.