RBI Cancels Certificates Of These Payment Operators; Users Can Claim Money Till 3 Years
Considering the non-compliance with regulatory requirements, the Reserve Bank of India (RBI) canceled the Certificate of Authorisation (CoA) of two Payment System Operators (PSOs) Muthoot Vehicle and Asset Finance Limited and Eko India Financial Services Private Limited on January 4.
Both Muthoot Vehicle and Asset Finance Limited and Eko India Financial Services Private Limited had the certificate of authorization which was issued by the RBI for issuance and operation of prepaid payment instruments.
RBI has reached this decision by exercising the powers conferred on it under the Payment and Settlement Systems Act, 2007.
Further, the central bank in the country said the COA cancellation is effective from December 31, 2021.
How Does This Affect?
This simply means that “Following the cancellation of the CoA, these companies cannot transact the business of issuance and operation of prepaid payment instruments,” according to the RBI statement.
It is noteworthy here that the customers or merchants having a valid claim on these companies as PSOs can approach them for settlement of their claims within three years from the date of cancellation, as per the statement.
Profile In Finance World
Basically, Muthoot Vehicle and Asset Finance Ltd. (MVFL), is the Vehicle and Asset Finance arm of The Muthoot Group.
The financial firm was incorporated in 1992 as Muthoot Leasing and Finance Ltd.
The name of the Company was formally changed to Muthoot Vehicle and Asset Finance Ltd during 2008.
It was done in order to correctly highlight the nature of financial solutions being provided by the Company.
According to the certification by the Reserve Bank of India, MVFL is a Deposit taking Asset Finance Company (DAFC).
The other company, Eko India Financial Services Private Limited is a private organization incorporated in 2007.
In terms of classification, it is classified as a non-govt company and is registered at the Registrar of Companies, Delhi.
The financial company claims to have served over 50 million customers as of today.
It is available over a merchant network of 1,50,000 customers.
The firm enables over 7 Million banking transactions a month according to its official website.
Eco has its own networks, it further provides APIs to over 300 partners who have built their own business on top of the Eko platform.