The Reserve Bank of India (RBI) today imposed a fine of Rs 5 crore on Airtel Payments Bank Limited for breaking the Know Your Customer (KYC) guidelines. “It is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers,” stated RBI. This will come as a massive blow for Airtel Payments Bank unit, and it’s unknown at the moment when the eKYC license of the company will be released. The RBI also said that “a monetary penalty of Rs 50 million has been imposed on Airtel Payments Bank Limited for contravening the Operating Guidelines for Payments Banks and directions issued by RBI on KYC.”
“The supervisory visit report and other relevant documents, revealed, inter alia, contraventions of ‘operating guidelines for payments banks’ and the directions issued by RBI on Know Your Customer (KYC) norms,” added RBI further.
Just a couple of days ago, the central bank also imposed a fine on three other banks- Axis Bank, Indian Overseas Bank and State Bank of India. Axis Bank suffered a massive penalty of Rs 3 crore, followed by Indian Overseas Bank with Rs 2 crore and lastly, the State Bank of India received a fine of Rs 40 lakh. And all the above-said banks are fined because of the classification of non-performing assets (NPAs) and violation of KYC norms.
Back in November 2017, it was reported that Airtel is opening Payments Bank account without the customers “informed consent”. As per several media reports, Airtel Payments Bank opened over 23 lakh payments bank accounts, and these consumers reportedly received Rs 47 crore in their opened payments bank accounts. And the sad part is consumers were not aware of the account opening.
And based on complaints from consumers, a supervisory team has visited Airtel Payments Bank for inspection, and based on the oral answers given by Airtel, UIDAI suspended Airtel’s eKYC licence. “After considering the bank’s reply and oral submissions made in the personal hearing, RBI came to the conclusion that the aforesaid charges of non-compliance with RBI guidelines/directions were substantiated and warranted imposition of monetary penalty,” RBI said.
In early January, UIDAI released the eKYC license of Airtel but did not release the license of Airtel Payments Bank though