Mumbai
The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹2.33 crore on Hyderabad-based Spandana Sphoorty Financial Ltd for its failure to adhere to pricing of credit guidelines for Non-Banking Financial Company - Micro Finance Institutions (NBFC-MFIs).
The pricing of credit guidelines are part of RBI’s ‘Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016.
Inspection report
RBI had conducted statutory inspections of the company, a NBFC- MFI, with reference to its financial position as on March 31, 2019 and March 31, 2020.
Examination of the Risk Assessment Report, Inspection Reports, supervisory letters and all related correspondence revealed that the company’s failure to adhere to pricing of credit guidelines for NBFC-MFI, according to the central bank’s statement.
“In furtherance to the same, a notice was issued to the company advising it to show cause as to why penalty should not be imposed on it for failure to comply with the RBI directions, as stated therein.
“After considering the company’s reply to the notice, examination of additional submissions made by it and oral submissions made during the personal hearing, RBI came to the conclusion that the charge of non-compliance with the aforesaid RBI directions was substantiated and warranted imposition of monetary penalty,” RBI said.
The central bank observed that its 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 company with its customers.
RBI said the penalty has been imposed in exercise of powers vested in it under the provisions of the Reserve Bank of India Act, 1934.
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