The Reserve Bank of India (RBI) imposed monetary penalties on the two Payment System Operators (PSOs) One Mobikwik Systems and Spice Money on Thursday for non-compliance with standards, according to a statement issued by the central bank.
The RBI stated that the measures are based on regulatory compliance problems and are not meant to rule on the validity of any transaction or agreement entered into by the firms with their customers.
The RBI discovered that the businesses had not followed the instructions offered on the net-worth criterion for Bharat Bill Payment Operating Units (BBPOUs), and notices were issued as a result.
The RBI evaluated their written responses as well as their oral comments during the personal hearing and found that the charges of non-compliance with RBI orders were proven and merited the imposition of monetary penalties.
“The penalties have been imposed in exercise of powers vested in RBI under the provisions of Section 30 of the PSS Act. These actions are based on deficiencies in regulatory compliance and are not intended to pronounce upon the validity of any transaction or agreement entered into by the entities with their customers,” the central bank said.
It noted that as these were offences of the nature referred to in Section 26 (6) of the PSS Act, notices were issued to the entities.
The RBI, on the other hand, emphasised that the fines are based on regulatory compliance shortcomings and are not meant to rule on the legitimacy of any transaction or arrangement entered into by the companies with their consumers.
The news comes as investors await the launch of MobiKwik’s INR 1,900 crore initial public offering (IPO). The financial behemoth gained SEBI permission on October 7 and was scheduled to launch its offering before Diwali.
However, due to low valuations and waning investor interest, the business has postponed its IPO, which is now anticipated to take place in the first quarter of 2022.
MobiKwik, situated in Delhi-NCR, is also being investigated by the RBI for an alleged data breach. According to an RTI filed by cybersecurity expert Srinivas Kodali in October, the RBI has taken notice of the data breach and is reviewing the forensic report supplied by the startup.
Earlier this year, MobiKwik was allegedly the victim of a data breach involving over 100 million subscribers. The hacked data is said to have an impact on Mobikwik consumers and merchants who have obtained loans from the company.
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