The Reserve Bank of India (RBI) on January 30, 2025, notified regarding the Framework for imposing monetary penalties and compounding of offences under the Payment and Settlement Systems Act, 2007.
The following has been stated namely: -
• This circular will supersede the Circular DPSS.CO.OD.No.1328/06.08.005/2019-20 dated January 10, 2020, on the ‘Framework for imposing a monetary penalty on authorized payment system operators/ banks under the Payment and Settlement Systems Act, 2007’.
• It provides that only material contraventions will be taken up for enforcement action in the form of imposition of monetary penalty or compounding of offences.
• It outlines the provisions for the Quantum of penalty. It states that the amount of penalty may be based on the principles of proportionality, intent and mitigating factors, if any.
• It further states that the monetary penalty or compounding amount shall be payable within a period of thirty days from the date of receipt of the penalty or compounding order.
The detailed framework is enclosed in the attached document.
[Notification no. - RBI/2024-25/108]
