Synopsis
On March 14, the Reserve Bank of India fined JM Financial Products Ltd Rs 3.10 lakh for regulatory non-compliance. Experian Credit Information Company was also penalized Rs 2 lakh for failing to adhere to credit information regulations.Key Takeaways
- RBI imposed Rs 3.10 lakh fine on JM Financial Products.
- Experian fined Rs 2 lakh for credit information violations.
- Penalties stemmed from non-compliance with regulatory guidelines.
- JM Financial was inspected as of March 31, 2023.
- Compliance issues do not affect transaction validity.
New Delhi, March 14 (NationPress) The Reserve Bank of India (RBI) has levied a financial penalty of Rs 3.10 lakh on JM Financial Products Limited due to non-compliance issues. This penalty was enforced for failing to adhere to specific provisions of the ‘Master Direction - Non-Banking Financial Company - Systemically Important Non-Deposit Taking Company and Deposit Taking Company (Reserve Bank) Directions, 2016’ as mandated by the Central Bank.
A statutory inspection of the organization was carried out by the RBI, focusing on its financial status as of March 31, 2023.
“Following supervisory findings concerning non-compliance with RBI directives and related communications, a notice was served to the company, requesting an explanation as to why a penalty should not be applied for its non-compliance with said directives,” the RBI stated.
Upon reviewing the company's response to the notice, along with additional submissions and oral statements presented during a personal hearing, the RBI concluded that the charge against the company was validated, necessitating the imposition of a financial penalty:
“This action is based on shortcomings in regulatory compliance and does not aim to comment on the legitimacy of any transactions or agreements made by the company with its clients. Additionally, the imposition of this financial penalty does not preclude any other actions that may be taken by the RBI against the company,” the bank elaborated.
In another development, the RBI has also sanctioned a financial penalty of Rs 2 lakh on Experian Credit Information Company of India for failing to comply with certain sections of the Credit Information Companies (Regulation) Act, 2005 [CIC (R) Act] and the Credit Information Companies Rules, 2006 [CIC Rules].
After assessing the company’s response to the notice and oral arguments presented during the personal hearing, the RBI determined that the company had not notified the credit institutions regarding discrepancies in credit information within the required timeframe of seven days after receiving requests.
The organization failed to update or correct the credit information and did not inform the borrowers of its inability to do so within the mandated 30-day period following requests for updates or corrections, as per the RBI.
