Reserve Bank of India Imposes Penalties on Payment System Operators Visa Worldwide, Ola Financial Services, and Manappuram Finance

The Reserve Bank of India (RBI) has taken strict action against three major payment system operators in the country. Visa Worldwide, Ola Financial Services, and Manappuram Finance have been penalized for failing to comply with regulatory requirements.

Visa Worldwide Pte Limited has been fined Rs 2.4 crore, while Manappuram Finance Limited faces a penalty of Rs 41.5 lakh. Ola Financial Services, on the other hand, has been hit with a fine of Rs 87.55 lakh in two separate cases.

The RBI stated that the penalties on Manappuram Finance and Ola Financial Services were imposed due to their non-compliance with Know Your Customer (KYC) guidelines. Compounding orders were also issued to Ola Financial Services and Visa Worldwide for violating specific provisions.

Visa Worldwide Pte Limited was found to have implemented a payment authentication solution without obtaining regulatory clearance from the central bank. After issuing a notice to the company, the RBI requested an explanation for the violation. Visa Worldwide then filed an application for compounding the violation, which was eventually approved by the RBI.

In a similar vein, Manappuram Finance Limited and Ola Financial Services were penalized for failing to comply with the RBI’s KYC requirements. Notices were served to these entities, and penalties were imposed after reviewing their responses and submissions.

Additionally, Ola Financial Services reported discrepancies in its escrow account balance, leading to a compounding application for the violation. After assessing the application and hearing oral submissions, the RBI decided to compound Ola Financial Services’ contravention.

The RBI clarified that the penalties were issued based on regulatory compliance shortcomings and do not reflect on the legitimacy of any transactions or agreements made by the entities with their customers.

(With inputs from agencies)