[India], Mar. 10 (ANI): The Reserve Bank of India (RBI) imposed a penalty of Rs. 5 crore on Airtel Payments Bank, the financial services arm of Bharti Airtel Limited, for violating operating guidelines and Know Your Customer (KYC) norms.
This penalty has been imposed "for contravening the 'Operating Guidelines for Payments Banks' and directions issued by RBI on KYC norms," RBI said in a statement.
"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 bank with its customers," the statement further read.
Based on the complaints and adverse media reports alleging that the bank had opened customer accounts without a specific consent of the customers, a supervisory visit to the bank was undertaken by RBI between November 20 and 22, 2017.
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 KYC norms.
Based on the documents, a notice dated January 15, 2018 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 came to the conclusion that the aforesaid charges of non-compliance with RBI guidelines were substantiated and warranted imposition of monetary penalty.
The central bank imposed a monetary penalty of Rs. 40 lakh on State Bank of India (SBI) on March 1 for non-compliance of its directions on detection and impounding of counterfeit notes.
The RBI had also imposed monetary penalties on Axis Bank (Rs. 30 million) for violation of non-performing asset classification norms and Indian Overseas Bank (Rs. 20 million) for not complying with the KYC regulations, recently. (ANI)