Airtel Payments Bank Gets Back Permission From RBI, UIDAI To Add New Customers

In a major relief, the Airtel Payments Bank, the mobile banking services unit of Airtel, has now secured fresh permissions from the Reserve Bank of India (RBI) and the UIDAI, to add new customers.

The license was revoked last year by the two authorities in the wake of some alleged fraudulent activities by the payments bank. It was alleged then that the Airtel Payments Bank was adding new customers without their exclusive permission. The bank was then forced to stop taking new customers and its e-KYC license was also revoked.

“Airtel Payments Bank has received requisite approvals from The Reserve Bank of India to start on-boarding new customers,” an Airtel statement said. “Airtel Payments Bank has also been permitted by the UIDAI to resume the on-boarding of customers using Aaadhaar based e-KYC.”

Th payments bank, the first in the country, will now be able to add new customers and offer the new age banking solutions.

“We thank the authorities for the approvals. We remain committed to the Government’s vision of financial inclusion and banking for all,” the statement read.

Airtel Payments Bank was launched in January 2017, and the services offered were too appealing for customers. The bank had managed to open one lakh savings accounts within two weeks. At one point of time it had more banking outlets than the total ATMs in the country. The bank was then offering 7% interest p.a on savings account – the highest in the country in the same category.

However, the e-KYC and Aadhaar controversy marred the reputation of the bank. So much so, that its CEO Sashi Arora had to step down and quit the company.

This development took place soon after a massive scam was unearthed related to Airtel Payments Bank where customers had complained that their Aadhaar account number was illegally used to open new bank accounts within Airtel Payments Bank. Further, these accounts were used to receive the customers’ government subsidy amount that they get from various government schemes. Shashi Arora was heading the Airtel payments Bank.

A total of Rs 190.1 crore was transferred to customers’ payments bank account in these manner.

The Aadhaar authority or UIDAI, after its initial probe to the allegations, found it to be true and suspended Airtel’s as well as its payment bank’s e-KYC license in this regard. The Sunil Mittal-led corporation was then asked to refund the entire amount along with the accrued interest immediately. The company had followed suit in this matter and is in the process of funding the amount.

UIDAI also had appointed PWC to investigate the matter and submit a final report in this matter. In the meanwhile the Aadhaar authority had allowed Airtel, not the payments bank, to us e-KYC to its mobile services related operations.

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