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The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹6.77 crore on Mahindra & Mahindra Financial Services Limited for non-compliance with the “Non-Banking Financial Company-Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016”.
The statutory inspection of the company was conducted by RBI with reference to its financial position as on March 31, 2019 and March 31, 2020.
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According to the RBI, an examination of the risk assessment report, inspection reports and all related correspondence has revealed non-compliance by the company with the RBI directions on fair practices related to disclosure of annualised rate of interest charged on loans to the borrowers at the time of sanction and failure to give notice of change in terms and conditions of loan to its borrowers.
After considering the company’s reply to a notice on this matter, oral submissions made during the personal hearing and on examination of additional submissions made by it, RBI has concluded that there was non-compliance and, thus, imposed monetary penalty
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