FM, RBI officials to hold meeting with fintech firms over KYC norms, compliance
It comes in the aftermath of the RBI asking the Paytm Payments Bank account holders to move their assets and look for alternative banks
Union Finance Minister Nirmala Sitharaman may hold a meeting with as many as 20 fintech firms, excluding Paytm, along with senior officials from the Reserve Bank of India (RBI) to emphasise on KYC compliance, a senior government official said.
“The Finance Minister is meeting the fintech firms sometime next week, possibly February 26 or 27. Senior officials from the RBI will also attend. At least 20 fintech firms, related to lending, payment processing and mutual funds are likely to be called for the meeting,” the official told Moneycontrol. “However, Paytm is unlikely to be called for the meeting,” he added.
The meeting comes in the aftermath of the RBI asking the Paytm Payments Bank account holders, both customers and merchants, to move their assets and look for alternative banks till March 15 on account of major anomalies in KYC compliance.
“The meeting is not on Paytm Payments Bank per se. Without taking any sides, the FM is likely to emphasise on the importance to adhere to KYC norms and compliances. Sitharaman will also hear the issues of the fintechs while urging them to comply,” the official said.
Since RBI officials will also talk to the fintechs about innovation and the issues in their regulation during the meeting. The finance minister will act as a mediator between RBI and the fintech companies, the official added.
The meeting is being seen as a Union government move to ensure that more fintechs do not come under the scrutiny of the central bank for KYC non-compliances.
The RBI imposed business restrictions on Paytm Payments Bank on January 31. The central bank said a comprehensive system audit report and subsequent compliance validation report of the external auditors revealed persistent non-compliance and continued material supervisory concerns in the bank, warranting further supervisory action.
The RBI has prohibited Paytm Payments Bank Ltd (PPBL) from accepting deposits or top-ups in any customer account, prepaid instruments, wallets, and FASTags after March 15. RBI Governor Shaktikanta Das has stated that there is limited scope for reconsidering the measures taken against Paytm Payments Bank. The central bank takes action against regulated entities only after conducting a thorough evaluation, he said.
