A former employee of the fintech business MobiKwik allegedly altered merchant details to cheat the company out of INR 1.26 Cr. The company said in an exchange filing that Gaurav Sharma, the former employee, diverted the money from its books between August 2023 and September 2024. The company’s book of accounts has been adjusted to reflect the amount that was stolen. According to MobiKwik, the individual in question is presently being held after the company filed a case with the Gurugram police. MobiKwik has put in place a number of corrective actions to close the gaps. These include creating distinct wallets for various business segments, limiting access to admin portals, requiring a VPN for SSO (single sign-on) login, reversing unused merchant incentive amounts to their respective wallets, and sending hourly alerts to authorised individuals for changes in sensitive fields, such as bank account details.
MobiKwik Going Through Slew of Challenges
The company has already been going through a difficult period on the stock exchanges when it was informed of the scam. The company’s shadInvestors were especially optimistic before the IPO because of MobiKwik’s demonstrated profitability over the course of a full fiscal year. But since then, the fintech’s financial performance has suffered. In fact, in the two quarters since going public, it has posted losses.
According to MobiKwik’s most recent financial declaration, the company lost INR 55.3 Cr in Q3 FY25, against a profit of INR 5.3 Cr in the same period last year. However, operating revenue increased by 18% year-over-year to INR 269.47 Cr in the December quarter, up from INR 228.93 Cr in Q3 FY24. Since then, the business has been attempting to strengthen its operations by venturing into unexplored areas.
Ongoing Developments at MobiKwik
By establishing a fully owned subsidiary, MobiKwik Securities Broking, the company has made its foray into the investing tech sector. This means that it will deal in commodities, currencies, debt instruments, shares, stocks, and securities, as well as their derivatives. It expanded its fixed deposit (FD) aggregation as its primary service in February by purchasing a share in Blostem Fintech, a B2B banking infrastructure firm, for INR 1.5 Cr. Going forward, the board of the corporation authorised an undisclosed investment in “one or more” subsidiaries.
Google Pay, Paytm, and PhonePe are competitors of Mobikwik, which was founded in 2009 by Bipin Preet Singh and Upasana Taku. In addition to other financial products, it provides buy-now-pay-later (BNPL) services and mobile wallets. On December 18, 2024, Mobikwik debuted on the stock market, with shares trading at INR 442.25.
JungleWorks has acquired Outplay, an AI-based SaaS firm, amid the world’s rising adoption of AI. According to Laxman Papineni, cofounder and CEO of Outplay, the Florida-based SaaS company purchased the majority of the startup from other investors. JungleWorks was founded in 2011 and runs a no-code hyperlocal delivery and commerce stack for on-demand business setup and management. It offers software solutions for e-commerce companies. Through its high-end technology, it manages everything from taking online orders and technician or driver assignments to delivery tracking and payment processing. In addition, JungleWorks intends to spend $14 million in Outplay after the acquisition. This investment will be done in order to boost the latter’s expansion and develop AI-powered sales automation solutions. JungleWorks will no longer have any influence over the sales engagement startup. Laxman and his brother, Outplay‘s CTO, Ram Papineni, will remain in charge of day-to-day operations.
More Focus on AI and Automation
The Papineni brothers founded Outplay in 2019. This AI-powered sales engagement platform helps corporate teams by automating monotonous chores. Additionally, it enables marketers to interact with potential customers via a variety of channels, including SMS, phone, and email. Among its more than 600 clients are Plum, Yellow.ai, and Observe.ai, according to the Sequoia Capital-backed business. About four years have passed since Outplay raised $7.3 million in its Series A fundraising round from Sequoia Capital. Laxman stated at that time that the venture would endeavour to enhance its AI technology stack. Since then, the field of artificial intelligence has undergone significant change. And now the automation has gone from a luxury into a vital necessity for company survival. The majority of businesses are using AI to automate tasks. Many new companies are appearing every day to meet the demands of organisations that are rapidly accelerating their adoption of AI. Outplay’s choice to be bought was primarily motivated by two factors: increased competition and parallels in their business strategies. It is important to note that Samar Singla, the founder and CEO of JungleWorks, has been an angel investor in Outplay since its inception.
How Merger will Help JungleWorks?
The combination will create an end-to-end ecosystem for client acquisition, engagement, and loyalty by integrating JungleWorks’ business automation tools with Outplay’s sales engagement platform. In 2025, Outplay intends to add roughly 50 new employees to help with company expansion. After the acquisition, the business will concentrate on developing two products. Firstly, a sophisticated CRM (customer relationship management) platform that optimises prospecting and deal administration. Secondly, AI SDR Agents (sales development agents) that enhance outbound sales. According to Laxman, Outplay is still committed to creating AI-driven SDRs and a cutting-edge CRM that will enable companies to grow their sales initiatives like never before. According to JungleWorks, it currently serves more than 21,000 companies worldwide, including Tata Play, McDonald’s, and KFC. Singla stated that JungleWorks’ goal of enabling businesses with AI at every point of the customer experience is a perfect match for this purchase.
The Karnataka government has funded 1,084 businesses with INR 249 crore in seed money through 21 rounds of the ELEVATE programme. Priyank Kharge, the state’s Minister of Biotechnology and Information Technology, disclosed these numbers during a just-concluded event. A grant-in-aid seed-funding programme called ELEVATE was created to assist Karnataka’s early-stage businesses. A total of INR 25 crore in subsidies have been given to 101 businesses under ELEVATE 2024. Of these, 36 are from outside Bengaluru, while 42 are led by women. The awards are worth between INR 21 lakh and INR 50 lakh. These businesses operate in a variety of industries, such as biotechnology, aerospace, sustainability, and rural innovation. At a fund-disbursement event on March 26, Kharge stated that many people had previously questioned the ELEVATE programme. Nonetheless, it has now provided funding to over 1,000 firms, of whom 25% are led by women and 30% are from rural regions. He went on to say that the government was dedicated to lowering regulatory barriers, increasing financing options, and guaranteeing access to international markets.
90 Days of Evaluation
According to department officials, the ELEVATE 2024 application and evaluation procedure was finished in 90 days. K-Tech Hubs and Centres of Excellence have been assigned to coach and incubate winning startups. The winners include Baeru, an ocean waste recovery startup that empowers rural women; Okulu Aerospace, which provides UAV surveillance solutions; Iniya Bioprobes, a biotech company based in Mysuru that develops microbial pigments; and Microleer Biopolymers, which makes vegan leather. According to Kharge, Bengaluru is leading the world’s startup revolution. There are already 45 unicorns in India’s Garden City, valued at a total of $161 billion. Through programmes like ELEVATE, the government hopes to place Karnataka in the top three worldwide startup ecosystems. The event was attended by about 300 people, including industry stakeholders and company founders. With Pocket Coach Technologies and Zebu Films among the top-funded businesses, the AVGC (Animation, Visual Effects, Gaming, and Comics) industry was a major focus this year. Kharge reaffirmed the government’s dedication to creating a startup ecosystem that is inclusive.
Karnataka’s Deep Tech Park
The state has been taking a number of steps to become the country’s startup leader. In the same line, Karnataka intends to construct a “Deep Tech” park to aid in the production of electronics, drones, electric vehicles, semiconductors, space technology, and the aerospace and defence sectors. The industrial hub would be built in the Chikballapur district of Karnataka, in Jangamakote. The area, which is expected to be called MV Deep Tech area, is roughly 60 km from Bengaluru. In addition, the state has launched the Karnataka Clean Mobility Policy 2025-30. This policy intends to draw INR 50,000 Cr in investment from the clean mobility value chain. Parallelly it will also construct a testing track and a state-of-the-art EV cluster with shared infrastructure to increase EV manufacturing. The state also plans to establish a Centre for Applied AI for Tech Solutions (CATS) with an investment of INR 50 Cr.
According to media reports, Indira IVF Hospital Ltd., which is funded by EQT, has temporarily cancelled its preparations for its IPO. The decision was taken due to a Bollywood movie about the life of its founder, Ajay Murdia. According to reports, the business, which had initially sought an IPO of INR 3,500 crore, reportedly encountered issues with the nation’s market regulator. SEBI was unhappy because of the release date of the film Tumko Meri Kasam. A little more than a month after the company revealed that it had secretly filed for an IPO. The film, which is a fictionalised account of Murdia’s life and his chain of clinics, was released on March 21. The main actors in the Vikram Bhatt-directed movie are Ishwak Singh, Esha Deol, Adah Sharma, and Anupam Kher. Nitiz and Kshitiz, the sons of Ajay Murdia, are acknowledged as producers, and Indira Entertainment is the production company.
IVF Indirectly Promoting Itself: SEBI
After noticing this, the Securities and Exchange Board of India (SEBI) expressed concerns about Indira IVF’s indirect self-promotion. According to various reports, the company reportedly withdrew the offer due to the regulator’s assessment of the biopic and the proximity of its release to the IPO filing. In response to a question from the media, the company said that after weighing a number of variables and business concerns, it had chosen to withdraw the previously submitted DRHP. Additionally, it stated that SEBI did not order them to revoke the offer. When the business might try to make the offer again is unknown. In 2023, Boston-based TA Associates and the company’s founders sold a majority share in Indira IVF to Stockholm-based investment firm EQT. Through the transaction, TA Associates left the company, but the Murdias kept a minority ownership and continued to run it.
Indira IVF’s Confidential Route of Filing
Indira IVF was one of the numerous businesses that recently chose to file confidentially. Credila Financial Services Ltd., Swiggy Ltd., Vishal Mega Mart Ltd., and edtech unicorn Physicswallah Ltd. are among the other businesses that chose the same path. Companies who choose to use the optional confidential initial public offering (IPO) process register their IPO in a confidential manner. In December 2022, SEBI made this available, and Tata Play Ltd. was the first business to utilise it. A business files their DRHP using this method, but the paperwork is not immediately made public. It is only made public when the business chooses to launch its initial public offering. A business might shield what it considers to be sensitive information from its rivals by utilising a confidential filing.
Thousands of inferior products were seized during a series of raids on Amazon and Flipkart warehouses on 27 March by the Bureau of Indian Standards’ (BIS) Delhi division. The operation, which lasted more than 15 hours, was conducted at a Flipkart subsidiary warehouse in Trinagar and Amazon’s warehouse in Delhi’s Mohan Cooperative Industrial Area. The Press Information Bureau (PIB) said that more than 3,500 products, including geysers, food mixers, and other electrical appliances, were seized during the operation at Amazon’s warehouse. Many of these products, officials discovered, either carried fake ISI labels or lacked the required ISI certification. It is anticipated that the seized commodities are worth around INR 70 lakh in total.
Raid at Instakart
BIS officers conducted a separate raid on Instakart Services Pvt Ltd, a Flipkart subsidiary located in Trinagar, Delhi. The crew discovered a cache of athletic shoes that lacked accurate production date information and did not adhere to ISI standards. About 590 pairs of athletic shoes valued at INR 6 lakh were seized by the authorities. These raids are a component of BIS’s broader national effort to enforce quality standards. Similar operations have been carried out in other places over the past month, including Delhi, Gurgaon, Faridabad, Lucknow, and Sriperumbudur, and several uncertified products have been seized as a result.
According to notifications from numerous regulatory bodies and various ministries of the government, the Bureau of Indian Standards requires compulsory certification for 769 products. Without a current licence or Certificate of Compliance (CoC) from BIS, it is completely forbidden to manufacture, import, distribute, sell, hire, lease, store, or exhibit for sale of these products.
Raids in Other Parts of the Country
Large amounts of goods being sold without the required certification were seized by the BIS during a search on the warehouses of e-commerce giants Amazon and Flipkart in the Tiruvallur district last week. 3,376 products, including insulated flasks, food containers, metallic potable water bottles, ceiling fans, and toys without BIS standard markings, were seized by authorities at Amazon’s Puduvoyal warehouse. The items that were confiscated are worth INR 36 lakh. In a separate investigation, BIS officers searched Flipkart’s Koduvalli warehouse and found 36 casserole boxes, 26 stainless steel water bottles, 10 insulated steel bottles that were not BIS certified, and 286 packs of baby nappies.
The BIS searched an Amazon warehouse in Hyderabad on March 25 and found 2,783 “uncertified” consumer goods valued at over INR 50 lakh. Products like smartwatches, electric water heaters, CCTV cameras, electric food mixers for the home, and both electric and non-electric toys were discovered to be lacking the required BIS certification, according to a report by a news agency. Additionally, Meesho, Myntra, and BigBasket received notifications from the bureau instructing them to sell only BIS-certified goods. Companies are subject to a fine of at least INR 2 lakh under Section 17 of the BIS Act, 2016. Up to ten times the value of the products sold or offered for sale may be included in this.
Offenders may also be imprisoned for up to two years, depending on the seriousness of the infraction. Pralhad Joshi, the minister of consumer affairs, stated in December of last year that winning over customers’ trust and confidence is essential for India’s e-commerce industry. He pointed out that in order to preserve product quality, online platforms must declare the nation of origin, guarantee transparent pricing, offer correct product specifications, and have clear return and refund procedures in place.
Vibrant Screen Pvt Ltd, offering background verification services worldwide, becomes a part of the CIEL HR Group.
National, 28th March 2025: CIEL HR Group is pleased to announce the acquisition of Vibrant Screen Pvt Ltd (VSPL), one of India’s largest providers of background verification solutions.
With over 24 years of expertise, VSPL offers a comprehensive suite of verification services, including employment, education, address, criminal records, database listing, credit history, drug test, and identity checks, designed to help organisations mitigate risks and ensure safe hiring practices. The company serves a diverse client base of over 240 organisations across the BFSI and IT sectors, including Fortune 500 companies. It has a strong reputation for its operational efficiency, technological innovation, and compliance with international standards.
CIEL HR has expanded its portfolio through strategic acquisitions, including Jombay, Aargee Staffing, Courseplay, Thomas Assessments / People Metrics. By virtue of these additions, CIEL HR has strengthened its offerings by adding HR tech solutions to its portfolio. By integrating these platforms, it has positioned itself in the industry as a tech-led HR solutions company. As India’s only provider of comprehensive, tech-driven HR solutions, CIEL HR supports every stage of the employee lifecycle.
VSPL’s proven track record, scalable business model, and robust growth strategy position it as a key player in the rapidly expanding background verification industry. This strategic acquisition aligns with CIEL’s vision of being a comprehensive HR solutions provider, enabling them to deliver enhanced value to the clients.
Implementing advanced technology for background verification is critical in mitigating fraudulent activities. Early intervention through comprehensive employee background checks, coupled with ongoing monitoring throughout an employee’s tenure, can help minimise operational oversight costs. This proactive approach prevents frauds and maintains vigilance against future fraudulent activities. CIEL aims to deliver the best of the holistic hiring solution to its clients by acquiring VSPL.
Strategic Expansion to Meet Growing Market Demands
The acquisition of Vibrant Screen represents a natural progression in CIEL HR Group’s growth strategy, adding a critical service component that modern businesses increasingly rely on. VSPL has built a stellar reputation in India and global markets with their unique tool that ensures swift and precise results, reducing turnaround times significantly in background checks. Their extensive verification services have helped countless organisations implement safe hiring practices through comprehensive candidate screening.
“The addition of VSPL’s capabilities represents a strategic milestone in our growth trajectory, enhancing our HR solutions,” said Mr. K Pandiarajan, Executive Chairperson of CIEL HR Group. “In today’s technology-driven business environment, thorough background verification is a must-have for building trustworthy teams and maintaining a company’s credibility. By bringing VSPL’s expertise under our umbrella, we’re offering our clients another layer of confidence in their hiring decisions while moving closer to our vision of being a truly comprehensive HR solutions provider.”
Adding to this Mr. Aditya Narayan Mishra, MD & CEO of CIEL HR, said “Our clients increasingly seek integrated HR solutions that streamline their processes while maintaining the highest standards of quality and compliance. The addition of Vibrant Screen’s verification expertise allows us to meet this demand head-on. The acquisition of Vibrant Screen represents a natural progression in CIEL HR Group’s growth strategy, adding a critical service component that modern businesses increasingly rely on. The combined technological capabilities of both organisations will further enhance our service offerings to our stakeholders.”
Major Vibhav Kapoor, Founder & CEO of Vibrant Screen, said, “Our partnership with CIEL HR marks a significant step forward, paving the way to new opportunities for innovation and service expansion for our valued clients. With a shared commitment to excellence and customer satisfaction, this collaboration is both a strategic and exciting move. Together, we will extend our verification solutions to a broader network of organisations while leveraging CIEL’s extensive industry presence and technological strengths.”
About CIEL HR
CIEL HR is India’s only company offering a complete suite of tech-driven HR solutions, covering the entire employee lifecycle. With 70 offices across 31 locations and more than 1350 employees, CIEL has served 4,967 companies as of Dec 31, 2024. Over the last three financial years and Q3 FY24-25, CIEL assessed 253,128 managers, payrolled 175,138 employees in Dec 2024, partnered with 50+ colleges through ProSculpt to engage 7900+ students and conducted offline training using LMS course content for 120K+ students across 500+ colleges in Tamil Nadu and Karnataka.
A former Zomato employee claims in a widely shared Reddit post that the firm unexpectedly and without warning fired over 300 employees, sparking uproar. According to the former worker, who says he was one of those affected, the decision was made based on an “average lateness” of only 28 minutes over three months—and this after he had demonstrated good performance and a solid track record. The post claims that Zomato failed to notify the staff of this significant change or provide them with an opportunity to address or resolve their attendance problems. They were astonished when they were unceremoniously terminated instead. The user blasted the corporation for treating employees like “disposable” and called this “a cold termination.”
A Post on Reddit Quickly Gained Popularity
Outrage over job security and business ethics in India’s startup sector was sparked by the post, which soon gained popularity. Similar tales were recounted by numerous Reddit users, who questioned the justice of such sudden dismissals. One poster, who claimed to be a current Zomato employee, detailed how quickly the terminations occurred, including how Slack accounts were disabled, access was refused, and staff members were let go without being given a chance to explain themselves. A lawyer encouraged impacted employees to take action and not take this lying down while offering legal support. Employees are being encouraged by users to “fight for the compensation” they are entitled to. Another ex-Zomato employee claimed they were let go for an unclear cause and that they were not informed that differences in login times would be considered non-compliance.
Lack of Job Security in Indian Startup Sector
Despite early indications of a market rebound, the 2024 Indian startup scene was characterised by large personnel cutbacks due to a number of causes. Notably, in order to adapt to the new business reality, some well-known companies were forced to announce significant layoffs, including Ola Electric, Paytm, Byju’s, Swiggy, and Flipkart. 11,250 positions were cut in the first half of the year alone, which had a significant effect on the labour dynamics of the industry while being less than in the past. Each company saw a different number of layoffs; for example, Byju’s reduced about 500 employees, Flipkart reduced 1,100 to 1,500, Ola Electric reduced 300 to 500, and Ola Cabs reduced 200 roles. Additionally, Paytm Payments Bank reported a notable layoff of about 555 workers, or 20% of its total staff.
The need for profitability, restructuring initiatives, previous overhiring during expansion times, changes in market dynamics, strategic business changes, and regulatory obstacles affecting particular industries were some of the factors that led to this wave of layoffs. Beyond the immediate loss of jobs, these layoffs have an impact on the Indian startup ecosystem’s short- and long-term prospects. Innovation may be slowed down in the near future as a result of talent loss and low staff morale. On the other hand, these changes might eventually make Indian startups more competitive and sustainable. How businesses adjust and how the larger ecosystem reacts to these changes will determine the overall impact.
BENGALURU, March 28, 2025: Elev8 Venture Partners, a $200 million growth-stage fund focused on high-potential Indian startups, has led a $50 million Series D funding round in smallcase, India’s leading model portfolios platform. The round also saw participation from State Street Global Advisors, Niveshaay AIF, Faering Capital, and Arkam Ventures. The capital raised will be used to expand smallcase’s investment product offerings across asset classes and strengthen its relationships with retail investors and ecosystem partners.
This investment reflects Elev8’s confidence in India’s rapidly evolving wealthtech landscape, as millions of retail investors seek simplified, transparent, and diversified investment solutions. With over INR 1.2 lakh crores in transactions and a user base of 10 million+ investors, smallcase has redefined how individuals manage their wealth. The fresh capital will accelerate smallcase’s product expansion across mutual funds, fixed income, and other asset classes while deepening its market reach.
Elev8 Venture Partners, anchored by South Korea’s KB Investment, focuses on B2B SaaS, Enterprise Tech, Consumer Tech, and FinTech. This is Elev8’s third investment, following its backing of IDfy, a leading identity verification platform, and Astrotalk, India’s largest astrotech platform. Elev8 remains committed to investing in high-growth, category-defining startups and sees smallcase as a key player in the rapidly evolving wealthtech space.
Speaking on the investment, Navin Honagudi, Managing Director and Founding General Partner at Elev8 Venture Partners, said: “India’s retail investing landscape is undergoing a seismic shift, and smallcase has been at the forefront of this transformation. Their ability to innovate, build trust, and scale in a highly competitive market makes them a standout player. At Elev8, we believe in backing companies that are not just growing fast but are also shaping industries. smallcase fits that vision perfectly, and we are excited to support them as they expand their offerings and reach millions more investors.”
Vasanth Kamath, co-founder & CEO of smallcase, said, “smallcase’s vision has always been to build simple and transparent products that are relevant for every investor’s portfolio. The opportunity to help millions of Indians design better financial futures is one of huge responsibility, and we will continue to deliver on it with honesty & integrity along with our partners. I am delighted to welcome our new shareholders who believe in our mission and are grateful to our existing investors for their trust & conviction”
Since its launch in 2016, smallcase has played a pivotal role in transforming how Indian retail investors access equity markets. Recognizing the growing demand for diversified investment options, smallcase recently expanded its offerings through a joint venture with Zerodha to launch an asset management company focused on index funds and ETFs.
With this fresh round of funding, smallcase is set to broaden its product suite, integrating asset classes like mutual funds and fixed income. The company will also enhance its technology and data analytics capabilities, equipping investors with smarter tools to optimise their wealth. Additionally, smallcase plans to strengthen its partnerships with leading financial institutions, enabling deeper industry-wide integration and adoption.
With India witnessing a surge in retail investor participation, Elev8 sees fintech and wealthtech as critical sectors poised for long-term growth. By investing in smallcase, Elev8 is reinforcing its commitment to backing high-growth companies that are building scalable, technology-driven financial solutions for the next generation of investors.
About Elev8 Venture Partners
Elev8 Venture Partners is a $200 million growth-stage fund anchored by South Korea’s KB Investment. The fund focuses on investing in high-growth Indian startups with the potential to scale globally. Elev8 primarily targets sectors such as B2B SaaS, Enterprise Tech, Consumer Tech, and FinTech.
About smallcase
smallcase is a leading provider of investment products and platforms for the capital markets industry. Launched in 2016, it operates India’s largest model portfolios platform and has served over 10 million individual investors across all its offerings till date. smallcase also provides technology solutions to 250+ leading financial institutions and brands across research firms, advisors, wealth managers and brokerages.
In a market with enormous growth potential, the Indian government plans to introduce a new cooperative-based taxi service called “Sahkar Taxi” nationwide as an alternative to well-known ride-hailing services like Ola and Uber. In Parliament on 26 March, Union Minister Amit Shah unveiled the idea, announcing that the new service will register four-wheeler taxis, rickshaws, and two-wheeler taxis. Additionally, he stated that Sahkar Taxi will guarantee that all profits flow directly to the drivers rather than big businesses, in contrast to current private firm services.
Reaping Financial Benefits for the Drivers
The Minister added that a government-run cooperative sarkar taxi service similar to Ola and Uber will be introduced in the upcoming months on a cooperative basis. Rickshaws, four-wheeler taxis, and two-wheeler taxis will all be registered by the service. The drivers of the vehicle will be the only recipients of the earnings from this service, not any large industrialists. The proposed action will pit the government against Uber, Ola, Rapido, and the recently developed app taxi aggregators like BluSmart, all of whom are fighting for a bigger share of the enormous market in the most populated nation in the world. With robust growth projections, rising Internet penetration, shifting lifestyles, and rising incomes, the market may also have plenty of room for new participants, even though the supply of app-cabs isn’t keeping up with demand. Prabhjeet Singh, president of Uber India and South Asia, had previously informed a media outlet that a lack of vehicles is making it difficult for ride-hailing services in India to satisfy growing customer demand, pointing to high asset ownership costs as a major obstacle.
State Governments Testing India’s Taxi Market
The Indian taxi industry is currently valued at $23.40 billion and is expected to reach $44.18 billion by 2030, according to Mordor Intelligence. With the introduction of Yatri Sathi by the Mamata Banerjee-led TMC administration in West Bengal, a comparable model is already in place. The service was first offered in Kolkata and has subsequently spread to Siliguri, Asansol, and Durgapur, among other places. Yatri Sathi is a handy and accessible choice for travellers around the region since it offers prompt dispatch, local language assistance (English or Bengali), reasonable fares, and round-the-clock customer service. Namma Yathri, a privately held taxi services app in Karnataka, uses a similar business model by guaranteeing that all earnings go to the drivers. With a variety of services like taxis, two-wheelers, four-wheelers, and pooling possibilities, the app gives drivers more control over their income while allowing passengers access to economical and effective modes of transportation.
The Reserve Bank of India (RBI) fined HDFC Bank INR 75 lakh after discovering that the bank had not followed certain of the guidelines outlined in the RBI’s Know Your Customer (KYC) master guidance. Notably, the RBI is referring to a KYC master circular that was last modified on November 6, 2024, having been issued on February 25, 2016. In a March 26, 2025, press release, the RBI said that HDFC Bank Limited (the bank) had been fined INR 75.00 lakh (Rupees Seventy-Five Lakh only) by an order dated March 24, 2025, for failing to comply with specific guidelines the RBI had given regarding “Know Your Customer (KYC).” In accordance with Section 47A(1)(c) read with Section 46(4)(i) of the Banking Regulation Act, 1949, the RBI was granted the authority to impose this penalty.
How it all Begin?
The RBI went on to clarify in its statement that the bank’s financial status as of March 31, 2023, was the subject of a Statutory Inspection for Supervisory Evaluation (ISE 2023) of the bank. A notice was sent to the bank asking it to provide justification for why it should not be penalised for its failure to follow the RBI’s instructions, based on supervisory findings of non-compliance and related correspondence. The RBI made it clear that this financial penalty is specifically tied to regulatory compliance shortcomings and has nothing to do with the legitimacy of any transactions or agreements the bank has made with its clients. Furthermore, the penalty has no bearing on any further actions the RBI may take against HDFC Bank.
HDFC Fails to Provide Satisfactory Response
In its official statement, the RBI stated that, among other things, it determined that the following charges against the bank were upheld, justifying the imposition of a monetary penalty, after taking into account the bank’s response to the notice and other submissions made by the bank. Based on its evaluation and perception of risk, the bank did not assign some of its customers to the low, medium, or high risk categories. Rather than assigning a Unique Customer Identification Code (UCIC) to every customer, the bank assigned numerous UCICs to certain consumers.
Why Banks Need to Follow RBI’s KYC Guidelines?
Reiterating the January 2004 instructions, the “Know Your Customer” guidelines were released in February 2005 in response to the Financial Action Task Force’s (FATF) recommendations on combating the financing of terrorism (CFT) and anti-money laundering (AML) standards. These guidelines are now the global norm by which regulatory bodies formulate anti-money laundering and anti-terrorism funding strategies. International financial ties now require that the nation’s banks, financial institutions, and NBFCs adhere to these requirements. The Reserve Bank’s Department of Banking Operations and Development has provided banks with comprehensive guidelines based on the Financial Action Task Force’s recommendations and the Basel Committee on Banking Supervision’s paper on Customer Due Diligence (CDD) for banks, with indicative suggestions where deemed necessary. NBFCs are equally subject to these rules.
Therefore, it is recommended that all NBFCs adopt it with appropriate modifications based on their activities and make sure that, within three months of the date of this circular, a proper policy framework on “Know Your Customer” and anti-money laundering measures is developed and implemented with the Board’s approval. Before December 31, 2005, NBFCs were urged to make sure they were completely in compliance with the guidelines.
