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In response to non-compliance with certain directions, the Reserve Bank imposed a penalty of 1 crore on Paytm Payments Bank Limited (PPBL) and 27.78 lakh on Western Union Financial Services.
The RBI stated in a release on Wednesday that upon examination of PPBL's application for issue of final Certificate of Authority (CoA), it had been observed that it had submitted information that did not reflect the actual position.
As this was a violation of Section 26 (2) of the Payment and Settlement Systems Act, 2007, a notice was issued to PPBL.
Having reviewed the written responses and oral submissions during the personal hearing, the RBI determined that the aforementioned charge was substantiated and warranted the imposition of a monetary penalty."
By an order dated October 1, the central bank imposed a monetary penalty of Rs 1 crore on PPBL.
According to the RBI, Western Union Financial Services broke the 30 remittance limit per beneficiary during 2019 and 2020 and has filed an application for compounding of the violation.
"After analyzing the compounding application and oral submissions made during the hearing, the IRS decided the non-compliance warranted a monetary penalty," the RBI said.
RBI, however, stressed the penalties are based on deficiencies in regulatory compliance and are not intended to take into account any agreement or transaction between entities and their customers.
Written by Yatendra Rathore || Senior Research Analyst At JOBAAJ.
