The Reserve Bank of India (RBI) has intensified its regulatory oversight by announcing monetary penalties on six companies, including the prominent non-banking financial company (NBFC) Muthoot Finance, for failing to comply with various regulatory directives. According to official notifications released by the central bank on Friday, the penalties were levied due to distinct operational and structural gaps discovered during supervisory evaluations.
Among the penalised institutions, Muthoot Finance was slapped with a fine of ₹5.80 lakh. The central bank stated that the gold loan major failed to put in place a system for the periodic review of risk categorisation of accounts. Furthermore, the company failed to deploy a robust software system essential for the effective identification and reporting of suspicious transactions. In a similar vein, the RBI penalized Satya MicroCapital ₹3.10 lakh for failing to accurately classify certain accounts as ‘non-performing assets’ (NPAs) upon restructuring. Muthoot Vehicle and Asset Finance alongside Dhani Loans and Services were also fined ₹2.70 lakh each for their respective compliance omissions.
The highest penalty of ₹6.20 lakh was slapped on Avail Financial Services. The central bank revealed that the firm’s Managing Director concurrently held directorships in two other middle-layer NBFCs, which directly breached corporate governance codes. Additionally, the company violated the prescribed single-party credit exposure limits. Similarly, PAN Emami Cosmed was fined ₹3.10 lakh for breaching the regulatory limits governing credit exposure to a single group of parties. The RBI reiterated that these actions are strictly based on deficiencies in regulatory compliance and are not intended to pronounce upon the validity of any transaction or agreement entered into by the companies with their customers.
