The Reserve Bank of India (RBI) has imposed penalties on Ola Financial Services Pvt. Ltd., Manappuram Finance Limited, and Visa Worldwide Pte. Ltd. for violations related to Know Your Customer (KYC) norms and unauthorized payment methods.
Ola Financial Services received two substantial fines from the RBI. The first fine of ₹33.40 lakh was imposed for non-compliance with KYC regulations. The second penalty of ₹54.15 lakh was related to lapses in regulatory adherence under the Payment and Settlement Systems Act, 2007. Additionally, Ola Financial Services reported a shortfall in its escrow account balance and has applied for compounding this violation.
The Master Direction – Know Your Customer (KYC) Directions, 2016, issued by the RBI on February 25, 2016, aims to combat money laundering and terrorist financing. A key component of these directions is the Customer Identification Procedure (CIP), which requires financial institutions to gather and verify essential customer information using reliable, independent sources like government-issued IDs.
Manappuram Finance Limited was fined ₹41.50 lakh for failing to meet KYC requirements. This penalty reflects the RBI’s action against non-compliance with crucial regulatory directives, similar to the situation with Ola Financial Services.
Visa Worldwide Pte. Ltd. faced a ₹2.4 crore fine for deploying a payment authentication solution without the required regulatory approval from the RBI. The RBI had previously instructed Visa to stop using the unauthorized payment method for commercial transactions.
The RBI’s guidelines on “Card Not Present (CNP) transactions – Relaxation in Additional Factor of Authentication (AFA) for payments up to ₹2000/-” issued on December 6, 2016, allow certain low-value transactions to bypass the additional authentication step usually required for online or remote payments. CNP transactions occur when the cardholder is not physically present at the point of sale, such as online or through mobile applications. The relaxation applies specifically to transactions not exceeding ₹2000, exempting them from the additional authentication requirement.
Posted and reproduced in Public Interest by
Adv. Sulaiman Bhimani Legal Consultant
Expert in RERA & Consumer Matters, Co-operative Scty Matters,
Deem Conveyance, Family Matters, and Property Disputes.
Human and Civil Rights Campaigner
President Citizens Justice Forum https://citizensjusticeforum.in
YouTube Channel https://tinyurl.com/CitizensJusticeForum
NEW CHANNEL FOR STOCK MARKET https://tinyurl.com/GreenWallet
WhatsApp +91 99877 43676