RBI Action: Reserve Bank gave a blow to Paytm Payments Bank, imposed a fine of Rs 5.39 crore – know the reason

RBI Action: Reserve Bank gave a blow to Paytm Payments Bank, imposed a fine of Rs 5.39 crore – know the reason

RBI Action on Paytm Payments Bank: The Reserve Bank of India (RBI) has imposed a fine on Paytm Payments Bank Limited for non-compliance of certain provisions including Know Your Customer (KYC) rules. A fine of Rs 5.39 crore has been imposed. The country’s Central Bank has given this information today.

Some flaws related to cyber safety framework were found in banks

The Reserve Bank found that there were some shortcomings in fully following the RBI guidelines for licensing payments banks, cyber safety framework in banks and certain provisions related to securing mobile banking applications including the UPI ecosystem. >

Auditors conduct comprehensive audit of Paytm Payments Bank

According to the official statement, a special investigation of the bank was conducted from KYC/Anti Money Laundering perspective and auditors selected by RBI conducted a comprehensive audit of the bank. According to the RBI statement, after inspecting the report, it was found that Paytm Payments Bank could not identify the beneficiaries regarding the entities involved in providing payment services.

RBI issues show cause notice to Paytm Payments Bank

The statement said that the bank did not monitor payment transactions and did not determine the risks of institutions availing payment services. The central bank said that "Paytm Payments Bank violated the regulatory limit of end-of-day balance in the advance accounts of some customers availing payment services." After this a show cause notice was issued to the bank. 

RBI imposed penalty on the bank

After receiving the reply of Paytm Payments Bank, RBI came to the conclusion that the allegation against the bank of not following the RBI guidelines has been proved. After this, monetary penalty was imposed on Paytm Payments Bank.

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