RBI imposed penalty on two Payment System Operators

The penalties have been imposed in the exercise of powers vested in RBI under the provisions of Section 30 of the PSS Act.

RBI imposed penalty on two Payment System Operators
Image credit: Reuters

New Delhi: The Reserve Bank of India (RBI) has imposed monetary penalty on the following two Payment System Operators (PSOs) for committing offences of the nature referred to in Section 26 (6) of the Payment and Settlement Systems Act, 2007 (PSS Act).
1    One Mobikwik Systems Private Limited  Rs. 100.00 Lakh penalty 
2    Spice Money Limited    December          Rs. 100.00 Lakh penalty 

The penalties have been imposed in the exercise of powers vested in RBI under the provisions of Section 30 of the PSS Act. These actions are based on deficiencies in regulatory compliance and are not intended to pronounce upon the validity of any transaction or agreement entered into by the entities with their customers.

Background

It was observed that the above entities had not complied with the directions issued by RBI on the net-worth requirement for Bharat Bill Payment Operating Units (BBPOUs). As these were offences of the nature referred to in Section 26 (6) of the PSS Act, notices were issued to the entities. After reviewing their written responses and the oral submissions made during the personal hearing, RBI concluded that the aforesaid charges of non-compliance with RBI directions were substantiated and warranted imposition of monetary penalty.