The Reserve Bank of India on Tuesday mentioned cost system operators (PSOs) shouldn’t outsource core administration features, together with danger administration and inside audit, compliance and decision-making features akin to figuring out compliance with KYC norms.
Announcing the framework for outsourcing cost and settlement-related actions by PSOs, the RBI mentioned the target is to place in place minimal requirements to handle dangers in outsourcing of cost and settlement-related actions together with duties akin to onboarding clients and IT-based companies.
“This framework is applicable to non-bank PSOs insofar as it relates to their payment and settlement-related activities,” the RBI mentioned, including that it’s relevant to all service suppliers, whether or not positioned in India or overseas.
The Reserve Bank mentioned core administration features would come with administration of cost system operations akin to netting and settlement, transaction administration like reconciliation, reporting and merchandise processing, in accordance sanction to retailers for buying, managing buyer information, danger administration, data expertise and knowledge safety administration.
The service supplier, except it’s a group firm of the PSO, shouldn’t be owned or managed by any director or officer of the PSO or their family members.
The RBI framework has additional mentioned that the PSO will rigorously consider the necessity for outsourcing its vital processes and actions and likewise the number of service suppliers based mostly on complete danger evaluation.
