The Reserve Bank of India (RBI) on Tuesday imposed a fine of Rs 2.50 crore on Bajaj Finance through compulsory recovery procedures for its lenders, violating standard guidelines and a single directive issued by the regulator. The central bank accused the financier of violating risk management guidelines and ethics in the provision of financial services to non-banking companies (NBFCs) and the relevant NBFC (FPC) code of practice. In addition, Bajaj Finance was also found to have violated certain guidelines to ensure full compliance with the FPC in writing and spirit.
This penalty is imposed on the use of the power imposed by the RBI under the provisions of the RBI Act, 1934. They do not harass or intimidate customers as part of debt collection efforts and thus fail to follow the above-mentioned guidelines issued by the RBI, the regulator said in a statement on its website. There were also repeated and repeated complaints about the acquisition and collection methods received by Bajaj Finance, the RBI said. Such recurring complaints required strict actions in terms of monetary penalties.
With the expiration of the above, notice has been given to the company stating that it has shown the reason why a fine should not be imposed for non-compliance. After reviewing the company’s response to the notice, the oral submissions made during the personal hearing, as well as the evaluation of the other submissions, the RBI concluded that the charge of non-compliance was substantiated and confirmed the imposition of fines. This action is based on errors in compliance with the law and is not intended to challenge the validity of any transaction or agreement entered into by the company and its customers, the regulator said. The charge of non-compliance with the stated directions by Bajaj Finance was found to be true and hence the monetary policy was imposed.