The Reserve Bank of India (RBI), which faced a barrage of questions on Paytm Payments Bank during the post-MPC customary interaction with media, said it would next week come out answers to frequently asked queries next week.
“Over the last few days, we have received a lot of queries. We have noted them down. Based on that, we will be issuing an FAQ (frequently asked questions) sometime next week,” governor Shaktikanta Das said.
His deputy Swaminathan J said the action against Paytm Payments Bank was based on persistent non-compliance.
“This is supervisory action for persistence non-compliance. Such action is invariably preceded by months and sometimes years of bilateral engagement where we point out the deficiencies but also give time to take corrective action. As a regulator, it is incumbent upon us to protect the consumer,” Swaminathan said at the press conference.
RBI action on Paytm Payments Bank
On January 31, the RBI imposed major business curbs on Paytm Payments Bank, including accepting fresh deposits and doing credit transactions after February 29. The decision comes after the central bank in March 2022 barred Paytm Payments Bank from onboarding new customers.
The regulator found major irregularities in KYC, exposing the customers, depositors, and wallet holders to serious risk.
The RBI found that in thousands of cases, the same PAN was linked to more than 100 customers and in some cases to more than 1,000 customers. The total value of transactions, running into crores of rupees, much beyond regulatory limits in minimum KYC pre-paid instruments raising money laundering concerns.
The regulator also found an unusually high number of dormant accounts which could be prone to be used as mule accounts. There were also concerns relating to money-laundering arising from deficiencies in the KYC processes and lack of transaction monitoring.
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