The Reserve Bank of India (RBI) has appointed Ola Financial Services Pvt. Ltd, for failing to comply with some regulations relating to prepaid payment instruments and know-your-customer (KYC) norms.
Ola Financial Services, the fintech subsidiary of ride-hailing company Ola, offers financial services such as two-wheeler, four-wheeler, personal loans and insurance products.
“The Reserve Bank of India (RBI) has fined Ola Financial Services Private Limited (the Company) ₹1,67,80,000 for failure to comply with certain provisions of the Master Directions on PPIs of the 27 Master Direction – Know Your Customer (KYC) Direction, 2016 of February 25, 2016,” the central bank said.
The company was found to have failed to comply with guidance issued by RBI on KYC requirements, RBI said. “Accordingly, a notice was served to the facility advising them to provide a reason why no penalty should be imposed for non-compliance with the instructions,” she adds.
After examining the company’s response, RBI concluded that the above allegation of non-compliance with RBI instructions was well founded and warranted the imposition of a fine, according to the banking regulator.
The penalty was 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 speak about the validity of any transaction or agreement entered into by the Company with its customers.
Meanwhile, the Reserve Bank of India has canceled the registration certificates of four non-bank financial corporations (NBFCs). These companies include Kanva Shree Credit Pvt. Ltd, Williamson Magor & Co. Ltd., Galaxy Capital Finance Ltd. and SRS Finance Ltd.
Earlier this month, the RBI fined Kotak Mahindra Bank Ltd. ₹1.05 crore for failing to comply with central bank rules. In certain cases, the lender had failed to credit the customer’s account with the amount associated with the unauthorized electronic transactions within 10 business days from the date of notification by the customer (shadow return). The bank also failed to meet or apply margins on advances to stockbrokers.
