RBI slaps Rs 3.06 crore fine on Amazon Pay, here's why

The Reserve Bank of India on Friday said it has imposed a penalty of over Rs 3.06 crore on Amazon Pay (India) Private Limited for non-compliance with certain provisions related to Prepaid Payment Instruments (PPIs) and Know Your Customer (KYC) direction.

"It was observed that the entity was non-compliant with the directions issued by RBI on KYC requirements," the RBI said in a statement.

The RBI had issued a notice to Amazon Pay (India) advising it to show cause as to why penalty should not be imposed for non-compliance with the directions.

"After considering the entity's response, RBI concluded that the aforesaid charge of non-compliance with RBI directions was substantiated and warranted imposition of monetary penalty," it said.

The central bank, however, added the penalty is based on deficiencies in regulatory compliance and not intended to pronounce upon the validity of any transaction or agreement entered into by the Amazon Pay (India) with its customers.

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Amazon Pay is the digital payment arm of e-commerce giant Amazon.