Airtel Payments Bank fined over KYC norms violation

Airtel Payments Bank has been imposed with a penalty of Rs 5 crore by the Reserve Bank of India for breaching Know Your Customer (KYC) norms.

"The Reserve Bank of India has imposed, on March 7, 2018, a monetary penalty of Rs 50 million on Airtel Payments Bank Limited for contravening the ‘Operating Guidelines for Payments Banks' and directions issued by RBI on Know Your Customer (KYC) norms," an official statement said.

The apex bank said that 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 bank with its customers. Last week, the RBI also imposed fine on three other banks — State Bank of India, Axis Bank and Indian Overseas Bank for non-compliance.

Based on the complaints and adverse media reports alleging that the bank had opened customer accounts without a clear/specific consent of the customers, RBI conducted a supervisory visit to the bank from November 20-22, 2017.

According to reports, more than 23 lakh customers had reportedly received as many as Rs 47 crore in their Airtel bank accounts, which they did not know had been opened. The supervisory visit report and other relevant documents, revealed contravention of 'Operating Guidelines for Payments Banks' and the directions issued by RBI on KYC norms, RBI said.