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Rs 1 Crore Penalty Imposed On PNB By RBI

RBI has also cancelled the Certificate of Authorisation of five Payment System Operators

Posted : 14 November, 2020
Author : Admin
Rs 1 Crore Penalty Imposed On PNB By RBI

Leading Public Sector Bank Punjab National Bank has said the RBI has imposed a penalty of Rs 1 crore on it for contravention of the Payment and Settlement Systems Act.“RBI has observed that the bank was operating a bilateral ATM sharing arrangement with Druk PNB Bank Ltd, Bhutan, (international subsidiary of the Bank), since April 2010 without the prior approval/authorisation from RBI,” it said in a stock exchange filing. 

The Reserve Bank of India (RBI) imposed the Rs 1 crore penalty for “contravention of the nature referred to in Section 26 (6) of the Payment and Settlement Systems Act, 2007 (PSS Act)”, it added.

The RBI said it has cancelled the Certificate of Authorisation (CoA) of five Payment System Operators (PSOs) engaged in issuance and operation of prepaid payment instruments. The certificates of Card Pro Solutions Private Limited and InCashMe Mobile Wallet Services Private Limited were cancelled because of ‘noncompliance with regulatory requirements’, while Delhi Integrated Multi-Modal Transit System Limited and Pyro Networks Private Limited voluntarily surrendered their certificates. 

The CoA of Aircel Smart Money Limited was cancelled because of non-renewal. All these five entities were into issuance and operation of prepaid payment instruments (PPIs). The RBI said following the cancellation of the CoA, the entities cannot transact the business of issuance and operation of PPIs. However, customers or merchants having a valid claim, if any, on these companies as PSOs, can approach them for settlement of their claims within three years from the date of cancellation, it added. 

The Reserve Bank of India (RBI) cancelled the certificates in exercise of the powers conferred on it under the Payment and Settlement Systems Act, 2007.