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The Reserve Bank of India (RBI) has imposed monetary penalties on Shri Ram Finance Corporation and Progfin for non-compliance with certain regulatory provisions and directions. Shri Ram Finance has been fined INR 8.10 lakh, while Progfin has been penalised INR 2.70 lakh. The RBI said Shri Ram Finance failed to obtain prior written approval before appointing a director, resulting in a change in management, and also did not have a required customer risk categorisation system. It also failed to upload certain KYC records to the Central KYC Records Registry within the prescribed timeline. Progfin was penalised for not conducting periodic reviews of customer risk categorisation at least once every six months.
The Reserve Bank of India (RBI) has imposed monetary penalties on Shri Ram Finance Corporation and Progfin for failing to comply with certain regulatory provisions and directions.
Shri Ram Finance Corporation has been fined INR 8.10 lakh, while Progfin has been penalised INR 2.70 lakh, the RBI said in a release.
Shri Ram Finance Corporation was penalised for failing to obtain prior written permission from the RBI before appointing a director, which resulted in a change in management after more than 30% of its directors, excluding independent directors, changed.
The company was also found to have failed to establish a system for categorising customers into low, medium and high-risk categories. In addition, it did not upload KYC records of certain customers to the Central KYC Records Registry within the prescribed timeline, the RBI said.
Progfin was penalised for failing to establish a system for periodic review of the risk categorisation of accounts. The RBI said such reviews are required to be carried out at least once every six months.
The penalties were imposed for the respective compliance lapses identified by the central bank.
Source PTI
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