RBI levies penalty of ~Rs1.70 crore on Ola Financial Services for breach of KYC -; other norms

13 Jul 2022 , 02:21 PM

The Reserve Bank of India (RBI) fined Ola Financial Services Private Limited Rs1.68 crore for failing to comply with certain provisions relating to pre-paid payment instruments and Know Your Customer norms.

"The RBI has imposed a monetary penalty of Rs1.68 crore on Ola Financial Services Private Limited as it did not comply with certain provisions of the Master Directions on PPIs issued on August 27, 2021 and the Master Direction - Know Your Customer (KYC) Direction, 2016, issued on February 25, 2016" stated the central bank in a statement.

Ola Financial Services Private Limited, a subsidiary of the ride-hailing app ‘Ola’, provides financial services such as two-wheeler and four-wheeler lending, personal loans, and insurance products.

The penalty was imposed by the RBI in the exercise of its powers under Section 30 of the Payment and Settlement Systems Act of 2007.

"It was discovered that the entity was non-compliant with the RBI's directions on KYC requirements," the central bank stated.

The entity was served with a notice requiring it to show cause why a penalty should not be imposed for failing to follow the directions, according to the statement.

"After taking the entity's response in due consideration, the RBI concluded that the aforementioned charge of noncompliance with RBI directions was substantiated and warranted imposition of monetary penalty," the RBI stated.