RBI imposes Rs 6 crore penalty on four White Label ATM operators

The RBI on Friday said it has imposed penalties totalling Rs 6 crore on four White Label ATM operators for deficiencies in regulatory compliance

The RBI on Friday said it has imposed penalties totalling Rs 6 crore on four White Label ATM (WLA) operators, including Hitachi Payment Services, and Tata Communications Payment Solutions, for deficiencies in regulatory compliance.

In a release, it also said a penalty of Rs 3 crore has been imposed on Transaction Analysts (India) Pvt Ltd for contravention of certain provisions of directions related to issuance and operation of prepaid payment instruments (PPIs), and Know Your Customer.

Monetary penalty has also been imposed on four WLA operators for "contravention of / non-compliance" with certain provisions of the directions in the White Label ATMs in India Guidelines' dated June 20, 2012.

A penalty of Rs 2 crore each has been imposed on BTI Payments and Hitachi Payment Services, and Rs 1 crore each on Tata Communications Payment Solutions Ltd and Vakrangee Ltd.

Giving details, RBI said on-site inspection of Transaction Analysts (India) revealed non-compliance with directions issued by it on escrow account balances, limits prescribed for certain transactions, and KYC.

The release further said off-site review of the operations of the WLA operators had revealed non-compliance with directions issued by RBI on ATM deployment and maintenance of net-worth.

RBI, however added the penalties on the five payment system operators are based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the entities with their customers.