New Delhi. The Reserve Bank of India (RBI) on Monday imposed fines on five entities, including Union Bank of India, Muthoot Housing Finance and CSB Bank, for violating various regulatory norms.
RBI found CSB Bank violating guidelines on ‘Risk Managing and Outsourcing of Financial Services’. The bank also did not follow some instructions issued on ‘Master Circular on Branch Authorization’. For this, a fine of Rs 1.86 crore has been imposed on the bank.
Why was Union Bank of India fined?
In another statement, RBI said that Union Bank of India also did not follow some norms on ‘Know Your Customer (KYC). Also, ignored the rules of creating a central repository required for risks. For this, a fine of Rs 1.06 crore has been imposed on the bank. Union Bank of India is a public sector unit of India, 60 percent of which is owned by the government.
What is the reason for the fine on Muthoot Housing Finance
In another release, the central bank said that Muthoot Housing Finance Company has been fined Rs 5 lakh for non-compliance of certain provisions of the ‘Non-Banking Financing Company – Housing Finance Company (Reserve Bank) Directions, 2021’. RBI has also imposed a fine of Rs 5 lakh on Nido Home Finance Limited and Rs 3.1 lakh on Ashoka Investment Limited for non-compliance of the norms.
Will the fine have any impact on customers?
RBI said that the penalty in each case is based on deficiencies in regulatory compliance. It is not intended to pronounce judgement on the validity of any transaction or agreement made in the entities. This means that RBI’s penalty will not affect any transaction of the customers.
