MUMBAI: The RBI has imposed a penalty of Rs 5.4 crore on Paytm Payments Bank for not complying with KYC directions and other guidelines pertaining to cybersecurity and payments banks.
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RBI had conducted a special scrutiny from a KYC/AML (anti-money laundering) perspective. The scrutiny brought out several areas of non-compliance, including failure to identify beneficial owners of entities onboarded for providing payout services, lack of monitoring of payout transactions and risk profiling, breaching regulatory balance ceilings, delayed reporting of a cybersecurity incident, and failure to implement device binding control measures related to SMS delivery receipts.
RBI also had issues with its video-based customer identification process (V-CIP) infrastructure and could not identify those logging in from outside the country.
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The bank was issued a show-cause notice. After considering its response to the notice and oral submissions during a personal hearing, RBI determined that the charge of non-compliance was substantiated, leading to the imposition of the penalty.
