The Finance Minister
(a) to (d) As apprised by the Reserve Bank of India (RBI), the list of Prepaid Payment Instrument (PPI) issuers, banks and Cross border Money Transfer (in-bound only) operators, found in violation of regulatory guidelines during the last five years is as follows:
Name of the Entity Date of the order Penalty (in Rs.)
Eko India Financial Services Private Limited March 9, 2017 5,00,000/-
My Mobile Payments Limited October 22, 2018 1,00,00,000/-
Phonepe Private Limited February 14, 2019 1,00,00,000/-
Y-Cash Software Solutions Private Limited February 22, 2019 5,00,000/-
Vodafone m-pesa Limited March 06, 2019 3,05,00,000/-
GI Technology Private Limited March 26, 2019 1,00,00,000/-
ZipCash Card Services Pvt. Ltd. April 22, 2019 11,25,000/-
Yes Bank Limited April 22, 2019 11,25,000/-
One Mobikwik Systems Pvt. Ltd. May 17, 2019 15,00,000/-
Hip Bar Private Limited May 24, 2019 10,85,000/-
Western Union Financial Services Inc. April 20, 2018 29,66,959/-
MoneyGram Payment Systems Inc. 10,11,653/-
As per RBI’s master direction dated 11.10.2017 (updated on 29.12.2017 and on 25.2.2019) on ‘Issuance and Operation of Prepaid Payment Instruments (PPIs)’, including Mobile wallets, the PPI issuers are to have a strong Risk Management system, for the safety and security of the payments systems operated by them and to put in place formal, publicly disclosed customer grievance redressal framework.
Further RBI’s circular dated 4.1.2019 on ‘Customer Protection – Limiting Liability of Customers in Unauthorised Electronic Payment Transactions in Prepaid Payment Instruments (PPIs) issued by Authorised Non-banks’, inter alia, stipulates “Zero Liability of a customer” where:
i. the unauthorised electronic payment transaction through a PPI occurs due to contributory fraud / negligence/ deficiency on the part of the PPI issuer, irrespective of whether or not the transaction is reported by the customer; or
ii. due to third party breach where the deficiency lies neither with the PPI issuer nor with the customer but lies elsewhere in the system, and the customer notifies the PPI issuer within three working days of receiving the communication from the PPI issuer regarding the unauthorised transaction.
Further the PPI issuer is mandated to credit the amount involved in such transactions to the customer’s PPI within ten days from the date of such notification by the customer.
The circular also stipulates limited liability of a customer for the loss occurring due to unauthorized transactions in certain cases. Further, in case of PPI issued by banks, customers can have recourse to the Banking Ombudsman Scheme for redressal of their grievances.
RBI also continuously endeavours to promote digital transactions in safe and secure manner and to identify the gaps and plug them for enhancing safety and security of the system which includes Prepaid Payment Instruments (PPIs) also.
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