RBI imposes ₹2 cr penalty on two Payment System Operators for regulatory violation
The Reserve Bank of India (RBI) fined Tata Communications Payment Solutions (TCPSL) Rs 2 crore and Appnit Technologies Pvt Ltd (ATPL) Rs 54.93 lakh for failing to comply with orders given under the Payment and Settlement Systems Act, 2007. (PSS Act).
“It was found that TCPSL was non-compliant with the guidelines provided by RBI on White Label ATM deployment targets and net-worth criteria,” the central bank said in a statement.
“ATPL failed to comply with the RBI’s instructions on the management of escrow account balances and net-worth requirements.”
Because these were offences of the type specified in Section 26(6) of the PSS Act, notices were sent to the entities.
According to Section 26(6) of the PSS Act, if any provision of this Act is violated, or if any default is made in complying with any other requirement of this Act, then the person guilty of such contravention or default, as the case may be, shall be punishable with a fine of up to ten lakh, and where a contravention or default is continuing, with a further fine of up to 25,000 for each day after the first during which the contravention or default occurs.
Following a consideration of their written responses and oral submissions made during the personal hearing, the RBI found that the aforementioned charges of non-compliance with its directives were proven and warranted the imposition of monetary penalties.
The RBI emphasised that the penalties were levied in the exercise of powers granted to it by the PSS Act.
“These measures are based on regulatory compliance inadequacies and are not meant to pronounce on the legitimacy of any transaction or agreement entered into by the firms with their clients,” the central bank stated.
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