The Reserve Bank of India (RBI) imposed a Rupees 20 Lakhs penalty on Manappuram Finance Limited by an order dated June 12, 2023 for non-compliance with certain provisions of the “NonBanking Financial Company- Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016.”
The background is that the statutory inspection of the company was conducted by RBI with reference to its financial position as on March 31, 2021 and examination of the Risk Assessment Report, Inspection Report, supervisory letter and all related correspondence pertaining to the same was revealed.
The Company did not comply with the directions of the company as follows:
Additionally, a notice was sent to the company instructing it to provide justification as to why a penalty should not be levied against it for failing to follow the instructions set forth in the RBI notice.
Following consideration of the company’s response to the notice, a review of additional submissions made by it, and oral arguments made during the in-person hearing, RBI came to the conclusion that the charge of failure to comply with the RBI directions was substantiated and called for the imposition of a financial penalty.
The fine was levied in accordance with the authority granted to the RBI under Sections 58G (1) (b) and 58B (5) (aa) of the Reserve Bank of India Act, 1934.
Recently, the RBI has imposed a penalty of Rs. 2.20 crores on Indian Overseas Bank on an order dated 29th May 2023. The RBI observed that there was significant divergence between the NPAs, as reported by it and as assessed by the inspection.
Read More: RBI Imposes Rs. 2.20 crore Penalty on Indian Overseas Bank
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