RBI imposes Rs46.70 Lakh Penalty on Citibank, Asirvad Micro Finance and JM Financial Home Loans
Moneylife Digital Team 24 February 2025
Reserve Bank of India (RBI) has imposed penalties of Rs46.70 lakh on Citibank and two non-banking financial companies (NBFCs), Asirvad Micro Finance Ltd and JM Financial Home Loans Ltd for non-compliance with the directions issued by the banking regulator. The highest penalty of Rs39 lakh has been imposed on Citibank.
 
Citibank has been penalised for non-compliance with directions issued by RBI on large exposures framework and furnishing of credit information to credit information companies (CICs).
 
RBI statutory inspection found that Citibank delayed reporting breaches in large exposure limits and failed to upload corrected data for certain segments within seven days after receiving rejection reports from CICs.
 
Asirvad Micro Finance has been fined Rs6.20 lakh for not complying with provisions of the RBI 2022 master direction on the regulatory framework for microfinance loans and for failing to appoint an internal ombudsman as required for NBFCs.
 
RBI found that Asirvad Micro Finance failed to report the household income of certain borrowers to CICs. Additionally, NBFC did not provide factsheets to some gold loan customers and did not establish a system to automatically escalate complaints that were partially or fully rejected by its internal grievance redress mechanism to the internal ombudsman for a final decision.
 
JM Financial Home Loans was penalised Rs1.50 lakh for not complying with provisions of the RBI 2021 NBFC housing finance company (HFC) directions. The company failed to disclose its approach for risk gradation and the rationale for charging different interest rates to various borrower categories in the application forms and did not communicate this clearly in the sanction letters.
 
In all three cases, RBI said penalties are based on deficiencies in regulatory compliance and are not intended to pronounce on the validity of any transaction or agreement they entered into with their customers.
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