What changed

The Reserve Bank of India (RBI) has levied a penalty of ₹3.10 lakh on Pine Labs Limited for failing to adhere to specific provisions concerning Prepaid Payment Instruments (PPIs). The enforcement action, dated March 23, 2026, follows a statutory inspection covering July 2024 to May 2025, which revealed that Pine Labs issued several Full-KYC PPIs without completing the requisite Know Your Customer (KYC) procedures for the holders.

This action highlights the critical importance of robust KYC compliance for entities operating in the payments sector. Pine Labs must ensure immediate remediation of these deficiencies to prevent further regulatory action. While this penalty is not intended to affect the validity of customer transactions, it underscores the need for strict adherence to RBI's regulatory framework for PPIs to avoid future penalties and maintain operational integrity.

What to do next

Review and update KYC procedures for all Full-KYC Prepaid Payment Instruments.
Ensure all PPI holders undergo complete KYC verification as per RBI directions.
Document remediation efforts and submit to RBI if requested.

Penalties

₹3.10 lakh

Source document (simplified)

Press Releases

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| Date : Mar 27, 2026 | |
| RBI imposes monetary penalty on Pine Labs Limited | |
| | The Reserve Bank of India (RBI) has, by an order dated March 23, 2026, imposed a monetary penalty of ₹3.10 lakh (Rupees Three Lakh Ten Thousand only) on Pine Labs Limited (formerly known as Pine Labs Private Limited) [the company] for non-compliance with certain provisions of the directions issued by RBI on ‘Prepaid Payment lnstruments (PPIs)’. This penalty has been imposed in exercise of powers conferred on RBI under the provisions of section 30(1) read with section 26(6) of the Payment and Settlement Systems Act, 2007.

The statutory inspection of the company was conducted by RBI with reference to its operations for the period from July 2024 to May 2025. Based on supervisory findings of non-compliance with RBI directions and related correspondence in that regard, a notice was issued to the company advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said directions.

After considering the company’s reply to the notice, additional submissions made by it and oral submissions made during the personal hearing, RBI found that the charge against the company of issuing several Full-KYC Prepaid Payment lnstruments (PPIs) without completing Know Your Customer (KYC) of the PPI holders was sustained, warranting imposition of monetary penalty.

The action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the company with its customers. Further, imposition of monetary penalty is without prejudice to any other action that may be initiated by RBI against the company.

(Brij Raj)
Chief General Manager

Press Release: 2025-2026/2336 | | The Reserve Bank of India (RBI) has, by an order dated March 23, 2026, imposed a monetary penalty of ₹3.10 lakh (Rupees Three Lakh Ten Thousand only) on Pine Labs Limited (formerly known as Pine Labs Private Limited) [the company] for non-compliance with certain provisions of the directions issued by RBI on ‘Prepaid Payment lnstruments (PPIs)’. This penalty has been imposed in exercise of powers conferred on RBI under the provisions of section 30(1) read with section 26(6) of the Payment and Settlement Systems Act, 2007.

The statutory inspection of the company was conducted by RBI with reference to its operations for the period from July 2024 to May 2025. Based on supervisory findings of non-compliance with RBI directions and related correspondence in that regard, a notice was issued to the company advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said directions.

After considering the company’s reply to the notice, additional submissions made by it and oral submissions made during the personal hearing, RBI found that the charge against the company of issuing several Full-KYC Prepaid Payment lnstruments (PPIs) without completing Know Your Customer (KYC) of the PPI holders was sustained, warranting imposition of monetary penalty.

The action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the company with its customers. Further, imposition of monetary penalty is without prejudice to any other action that may be initiated by RBI against the company.

(Brij Raj)
Chief General Manager

Press Release: 2025-2026/2336 |
| The Reserve Bank of India (RBI) has, by an order dated March 23, 2026, imposed a monetary penalty of ₹3.10 lakh (Rupees Three Lakh Ten Thousand only) on Pine Labs Limited (formerly known as Pine Labs Private Limited) [the company] for non-compliance with certain provisions of the directions issued by RBI on ‘Prepaid Payment lnstruments (PPIs)’. This penalty has been imposed in exercise of powers conferred on RBI under the provisions of section 30(1) read with section 26(6) of the Payment and Settlement Systems Act, 2007.

The statutory inspection of the company was conducted by RBI with reference to its operations for the period from July 2024 to May 2025. Based on supervisory findings of non-compliance with RBI directions and related correspondence in that regard, a notice was issued to the company advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said directions.

After considering the company’s reply to the notice, additional submissions made by it and oral submissions made during the personal hearing, RBI found that the charge against the company of issuing several Full-KYC Prepaid Payment lnstruments (PPIs) without completing Know Your Customer (KYC) of the PPI holders was sustained, warranting imposition of monetary penalty.

The action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the company with its customers. Further, imposition of monetary penalty is without prejudice to any other action that may be initiated by RBI against the company.

(Brij Raj)
Chief General Manager

Press Release: 2025-2026/2336 | |