The Reserve Bank of India Slaps Visa with $288,000 Fine for Unauthorized Payment Transfer Method
In a recent development, the Reserve Bank of India (RBI) has imposed a penalty of 24.1 million rupees, equivalent to nearly $288,000, on Visa. The fine comes in relation to Visa’s utilization of an unauthorized payment transfer method, according to a statement released by the central bank on Friday.
The RBI highlighted that Visa had implemented a payment authentication solution without obtaining regulatory clearance from them, although specific details regarding the transgression were not disclosed. In response to the penalty, a Visa spokesperson stated, “We duly acknowledge the RBI order and remain committed to following RBI guidelines and regulations to continue providing safe and secure payment solutions in India.”
Earlier in February, the RBI had directed the credit card company to cease using an unauthorized route for certain commercial payments. This move underscores the central bank’s efforts to tighten scrutiny over the processes followed by financial technology (fintech) firms.
This regulatory action serves as a reminder of the importance of compliance with established guidelines and regulations in the financial sector. As businesses navigate the evolving landscape of digital payments, adherence to regulatory frameworks is crucial to ensure the safety and security of financial transactions in India and beyond.
(Source: Reuters)
BENGALURU (Reuters) -The Reserve Bank of India imposed a penalty of 24.1 million rupees (nearly $288,000) on Visa (NYSE:) in relation to its usage of an unauthorised payment transfer method, the central bank said on Friday.
“It was observed that the entity (Visa) had implemented a payment authentication solution without regulatory clearance from RBI,” the central bank said in a statement, without providing details on the transgression.
“We duly acknowledge the RBI order and remain committed to following RBI guidelines and regulations to continue providing safe and secure payment solutions in India,” a Visa spokesperson said in a statement.
In February, the RBI had ordered the credit card company to stop using an unauthorised route to make some commercial payments, per a Reuters report.
The central bank has aimed to tighten scrutiny of the processes followed by financial technology, or fintech, companies.
($1 = 83.6990 Indian rupees)