The Reserve Bank of India (RBI) has imposed, by orders dated July 06, 2021, monetary penalty on fourteen banks, for non-compliance with certain provisions of directions issued by RBI on ‘Lending to Non-Banking Financial Companies (NBFCs)’, ‘Bank Finance to Non-Banking Financial Companies (NBFCs)’, ‘Loans and Advances – Statutory and Other Restrictions’, ‘Creation of a Central Repository of Large Common Exposures – Across Banks’ read with the contents of Circular on ‘Reporting to Central Repository of Information on Large Credits (CRILC)’, ‘Operating Guidelines for Small Finance Banks’ and for contraventions of provisions of Section 19(2) and Section 20(1) of Banking Regulation Act, 1949
The penalties have been imposed in exercise of powers vested in RBI under the provisions of section 47A(1)(c) read with sections 46(4)(i) and 51(1), of the Banking Regulation Act, 1949, as applicable. This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the banks with their customers.
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