RBI slaps Rs 5 crore fine on Airtel Payments Bank over KYC norms

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Updated: March 9, 2018 7:05:41 PM

The Reserve Bank of India (RBI) has slapped Sunil Mittal's Airtel Payments Bank with a fine of Rs 5 crore for breaching Know Your Customer (KYC) norms.

Bharti Airtel , gbi submarine cable, airtel businessRBI slaps Rs 5 crore fine on Sunil Mittal’s Airtel Payments Bank over KYC norms.

The Reserve Bank of India (RBI) has slapped Sunil Mittal’s Airtel Payments Bank with a fine of Rs 5 crore for breaching Know Your Customer (KYC) norms. The central bank 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 the RBI on KYC.

The RBI this week has also imposed fine on three other banks — State Bank of India, Axis Bank and Indian Overseas Bank for non-compliance. The penalty on Airtel Payments Bank is being imposed based on the complaints and adverse media reports alleging that the bank had opened customer accounts without a clear or specific consent of the customers, the RBI said in a statement on Friday.

The RBI had issued a show cause notice on January 15 to the bank asking it to explain why the penalty should not be imposed on them after a supervision report which found them contravening the Operating Guidelines for Payments Banks.

Airtel Payments Bank, however, maintained that no bank account was opened without the consent of the customers. A company spokesperson in December had said that the company has issued new instructions and urged customers to remain careful while completing their KYC processes.

On Wednesday, the RBI said that it has imposed a fine of Rs 40 lakh on largest lender State Bank of India (SBI) for non-compliance with the directions issued by RBI on Detection and Impounding of Counterfeit Notes. Earlier this week, the central bank had also fined Axis Bank and Indian Overseas Bank (IOB).

The penalty was imposed when it found Axis Bank in violation of many regulations in the assessment of non-performing assets (NPAs) and on IOB when a fraud detected at one of its branches.

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