RBI Intensifies Crackdown on Financial Sector Fraud, Targets Paytm and Banks

The Reserve Bank of India escalates its efforts to combat fraud, signaling a tougher stance on banks and fintech firms, with Paytm facing significant scrutiny.

The RBI's recent actions against Paytm and other financial institutions highlight a growing impatience with lapses in customer verification and potential fraud.
Fines for failing to properly vet customers are becoming more frequent, as the central bank aims to strengthen risk management in the financial sector.
The crackdown includes a directive to Visa to halt a payments service for transactions with unauthorized merchants, underscoring the RBI's broader regulatory efforts.
Paytm's banking affiliate was barred from accepting new credits and mobile wallet transactions, affecting its operations and stock value.
Authorities emphasize the importance of depositor and customer interests, indicating that financial stability remains a prime concern amid rising fraud cases.