BBN Bureau
Non-compliance with PPIs norms cited as reason
KOCHI/April 18-2022: The Reserve Bank of India (RBI) has imposed monetary penalty of Rs17.64 lakh on Manappuram Finance Ltd for non-compliance with certain provisions with regard to the operation of the prepaid payments instruments (PPIs).
Manappuram Finance, the second largest gold loan company in Kerala, is a well-diversfiied NBFC with presence in micro finance, auto finance, housing loans, etc.
“The penalty has been imposed in exercise of powers vested in RBI under Section 30 of the Payment and Settlement Systems Act, 2007. This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the entity with its customers,” the RBI statement added.
Background
RBI said that Manappuram Finance was non-compliant with the directions issued by RBI on know-your-customer (KYC) and small PPI requirements. 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.
“After considering the entity’s response and giving it a personal hearing, RBI concluded that the said charge of non-compliance with RBI directions was substantiated and warranted imposition of monetary penalty,” the RBI statement further said.
