Getty ImagesThe Reserve Bank of India (RBI) has imposed a fine on Manappuram Financing, a non-banking finance company, of Rs 17 lakh for violating KYC rules and prepaid payment instrument norms.
According to an RBI press release issued on April 18, 2022, “The penalty has been imposed in exercise of powers vested in RBI under Section 30 of the Payment and Settlement Systems Act, 2007. This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the entity with its customers.”
Why was the fine imposed?
The company was found to be in violation of RBI instructions on KYC and minor PPI standards. As a result, the entity was given notice to show cause why a penalty should not be applied for failing to follow the orders.
RBI found that the aforementioned accusation of non-compliance with RBI orders was proven and warranted imposition of monetary penalty after reviewing the entity's answer and giving it a personal hearing.
According to an RBI press release issued on April 18, 2022, “The penalty has been imposed in exercise of powers vested in RBI under Section 30 of the Payment and Settlement Systems Act, 2007. This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the entity with its customers.”
Why was the fine imposed?
The company was found to be in violation of RBI instructions on KYC and minor PPI standards. As a result, the entity was given notice to show cause why a penalty should not be applied for failing to follow the orders.
RBI found that the aforementioned accusation of non-compliance with RBI orders was proven and warranted imposition of monetary penalty after reviewing the entity's answer and giving it a personal hearing.
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