RBI fines Pine Labs Rs 3.1 lakh for KYC lapses
The Reserve Bank of India (RBI) said on Friday it has imposed a monetary penalty of Rs 3.1 lakh on fintech major Pine Labs for violating its directions on prepaid payment instruments (PPIs).
The order, dated March 23, 2026, follows a statutory inspection of the company’s operations conducted between July 2024 and May 2025.
RBI said the action was based on findings of non-compliance with certain provisions of its PPI guidelines. This specifically includes the issuance of several full-KYC prepaid instruments without completing the know-your-customer (KYC) formalities of the customer.
A show cause notice was issued to Pine Labs, and the central bank decided to levy the penalty after considering the company’s written response, additional submissions, and oral arguments during a personal hearing, the RBI said in a statement.
The penalty has been imposed under Section 30(1) read with Section 26(6) of the Payment and Settlement Systems Act, 2007. RBI clarified in its statement that the action stems from deficiencies in regulatory compliance and is not intended to question the validity of any transactions or agreements between Pine Labs and its customers.
In November last year, Pine Labs secured payment aggregator licences for offline payments, online merchant payments, and processing cross-border payments.
The order, dated March 23, 2026, follows a statutory inspection of the company’s operations conducted between July 2024 and May 2025.
RBI said the action was based on findings of non-compliance with certain provisions of its PPI guidelines. This specifically includes the issuance of several full-KYC prepaid instruments without completing the know-your-customer (KYC) formalities of the customer.
A show cause notice was issued to Pine Labs, and the central bank decided to levy the penalty after considering the company’s written response, additional submissions, and oral arguments during a personal hearing, the RBI said in a statement.
The penalty has been imposed under Section 30(1) read with Section 26(6) of the Payment and Settlement Systems Act, 2007. RBI clarified in its statement that the action stems from deficiencies in regulatory compliance and is not intended to question the validity of any transactions or agreements between Pine Labs and its customers.
In November last year, Pine Labs secured payment aggregator licences for offline payments, online merchant payments, and processing cross-border payments.
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