The Financial Intelligence Unit-India (FIU-IND) has slapped a hefty penalty of Rs. 5.49 crore on Paytm Payments Bank Ltd (PPBL) for breaching its obligations under the Prevention of Money Laundering Act (PMLA), announced the Finance Ministry on Friday.Financial Intelligence Unit-India (FIU-IND) imposes penalty of Rs 5,49,00,000 on Paytm Payments Bank Ltd with reference to violations of its obligations under PMLA pic.twitter.com/OfN4kzy8tq— ANI (@ANI) March 1, 2024RBIs regulatory measureThe decision follows ongoing scrutiny of PPBL by the Reserve Bank of India (RBI) due to persistent non-compliance and significant supervisory concerns.In response to RBIs actions, Paytms parent company, One 97 Communications, disclosed that its board has sanctioned the discontinuation of inter-company agreements with Paytm Payments Bank to reduce dependencies.The penalty imposed by FIU-IND is rooted in violations of PMLA obligations, as outlined in Section 13(2)(d) of the act, along with related rules and guidelines. The Centre clarified that the penalty amount stands at Rs. 5,49,00,000.Regulatory directives and deadlinesMoreover, the RBI has directed Paytm Payments Bank Ltd to cease deposits, credit transactions, and wallet top-ups in customer accounts, prepaid instruments, and wallets by March 15.Subsequently, the RBI instructed the National Payment Council of India (NPCI) to evaluate One97 Communications request to serve as a Third-Party Application Provider (TPAP) for ongoing Unified Payments Interface (UPI) operations through the Paytm application.Future compliance with UPI operationsApproval as a TPAP is essential to continue providing UPI-based payment transactions to customers. Presently, all UPI transactions on the Paytm app are routed through PPBL, a subsidiary of One97 Communications, registered as TPAP.
