RBI imposes penalties on Visa Worldwide, Ola Financial Services, Manappuram Finance

The RBI said on Friday that it had imposed penalties on payment system operators Visa Worldwide, Ola Financial Services, and Manappuram Finance for certain deficiencies in regulatory compliance. The penalty amounts were Rs 2.41 crore for Visa Worldwide, Rs 41.5 lakh for Manappuram Finance, and Rs 87.55 lakh for Ola Financial Services, the banking regulator said in a press release. 

"The above actions have been taken in the exercise of powers vested in the RBI under the provisions of Section 30 and Section 31 of the Payment and Settlement Systems Act, 2007, and 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 entity with its customers," the RBI said. 

The RBI said that Visa Worldwide had implemented a payment authentication solution without regulatory clearance from it.

"Accordingly, notice was issued to the entity advising it to show cause as to why penalty should not be imposed for non-compliance with the directions. The entity in its response had filed an application for compounding of the violation. After analysing the compounding application and oral submissions made during the personal hearing, RBI determined that the aforementioned contravention can be compounded," the RBI said. 

“Visa respects and abides by the compliance guidelines, regulations and local laws across the countries we operate in. We duly acknowledge the RBI order and remain committed to following RBI guidelines and regulations to continue providing safe and secure payment solutions in India," a Visa spokesperson said. 

The RBI said that Manappuram Finance and Ola Financial Services were non-compliant with its directions on KYC requirements. "Accordingly, notices were issued to the entities advising them to show cause as to why penalty should not be imposed for non-compliance with the directions. After considering 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," the RBI added. 

Ola Financial Services had also reported instances of shortfall in the balance in its escrow account and filed an application for compounding of the violation, according to the RBI. "After analysing the compounding application and oral submissions made during the personal hearing, RBI determined that the aforementioned contravention can be compounded," it said.