RBI imposes ₹61 lakh penalty on Nainital Bank; Ujjivan Small Finance Bank fined ₹7 lakh

RBI also levied a penalty of ₹5.80 lakh on Shriram Finance, a non-banking entity, for non-compliance with certain provisions.

The Reserve Bank on Friday said it has imposed penalties totalling ₹68.1 lakh on two banks -- Nainital Bank and Ujjivan Small Finance Bank -- for contravention of regulatory norms.

The Reserve Bank of India (RBI) seal is pictured on a gate outside the RBI headquarters in Mumbai.

A penalty of ₹61.40 lakh was imposed on Nainital Bank Ltd for non-compliance with certain directions on ‘Interest Rate on Advances’ and ‘Customer Service in Banks’, RBI said in a statement.

Further, RBI imposed a penalty of ₹6.70 lakh on Ujjivan Small Finance Bank for non-compliance with certain directions issued by RBI on ‘Loans and Advances - Statutory and Other Restrictions’.

RBI also levied a penalty of ₹5.80 lakh on Shriram Finance, a non-banking entity, for non-compliance with certain provisions, including Know Your Customer (KYC ) guidelines and directions on ‘Data Format for Furnishing of Credit Information to Credit Information Companies’.

The penalties are based on the deficiencies in regulatory compliance and are not intended to pronounce upon the validity of any transaction or agreement entered into by the lenders with their customers, according to three separate statements issued by RBI.

Imposition of these monetary penalties is without prejudice to any other action that may be initiated by RBI against the company.