Business News
RBI slaps ₹5 crore penalty on Airtel Payments Bank for breach of KYC norms
The Reserve Bank of India (RBI), on Friday, imposed a penalty of ₹5 crore on Airtel Payments Bank Limited (the bank) for contravening the operating guidelines for payments banks and directions issued it on Know Your Customer (KYC) norms.
This action is based on deficiencies in regulatory compliance, the RBI said. “It is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers,” it added.
Based on the complaints and adverse media reports alleging that the bank had opened customer accounts without a clear/specific consent of the customers, a supervisory visit to the bank was undertaken between November 20 and 22, 2017, the RBI said.
“The supervisory visit report and other relevant documents, revealed, inter alia, contraventions of ‘operating guidelines for payments banks’ and the directions issued by RBI on Know Your Customer (KYC) norms,” it added.
Based on the documents, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed for non-compliance with guidelines and directions issued by RBI.
After considering the bank’s reply and oral submissions made in the personal hearing, RBI said it had come to the conclusion that the aforesaid charges of non-compliance with guidelines/directions were substantiated and warranted imposition of monetary penalty.
