The Reserve Bank of India has imposed a penalty of over Rs 1.67 crore on Ola Financial Services for non-compliance with certain provisions related to pre-paid payment instruments and Know Your Customer (KYC) norms.

Ola Financial Services, a subsidiary of ride-hailing app Ola, offers financial services such as lending for two-wheelers, four-wheelers, personal loans and insurance products.

"It was observed that the entity was non-compliant with the directions issued by RBI on KYC requirements," RBI said in a statement.

The central bank issued a notice to Ola Financial Services advising it to show cause as to why a penalty should not be imposed for non-compliance with the directions.

After considering the entity's response, RBI concluded that the charge of non-compliance with its directions was substantiated and warranted imposition of monetary penalty.

The penalty is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by Ola Financial Services with its customers, RBI said.