After five months of placing the ban by RBI on Fino Payments Bank, the banking regulator has finally allowed it to add new customers to its platform.
Due to flouting norms where balances in some accounts with Fino had exceeded the regulatory limit of Rs 1 lakh, RBI had barred it from adding new customers.
According to the Fino Payments Bank, it had made all the required changes to processes, product, and technology, which the RBI has approved and given it go ahead signal.
Out of the five payment banks operating in the country (Paytm, Airtel, Fino and Aditya Birla-Idea Payments Bank, and India Post Payments Bank), Fino, Airtel and Paytm had faced RBI clampdown in the past.
While Airtel Payments Bank got full-fledged licence to add more customers in July, Paytm is yet to get the green signal from the banking regulator.
Earlier, RBI had reportedly objected cashback and other discounts offered by Paytm while onboarding customer for its Payments Bank. The regulator also has asked it to do the KYC physically instead of e-KYC for signing up new customers.
Meanwhile, payment banks are waiting for further clarity from RBI with respect to the options available to them for fulfilling know your customer (KYC) after Supreme Court rule of barring private entities from accessing the Aadhaar database.
Fino Payments Bank started operations in September last year. It currently has more than 400 banking outlets and over 50,000 access points.
The development was reported by Mint.