RBI imposes monetary penalty on this nbfc

New Delhi: The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 2.40 lakh on Valuecorp Securities & Finance Ltd, for non-compliance with certain directions issued by RBI on ‘Submission of data to Credit Information Companies’, ‘Transfer of Loan Exposure’ and ‘Know Your Customer (KYC)’.

The penalty has been imposed in exercise of powers conferred on RBI under Section 25(1)(iii) read with Section 23(4) of the Credit Information Companies (Regulation) Act, 2005 and Section 58G(1)(b) read with Section 58B (5) (aa) of the Reserve Bank of India Act, 1934.
 

The statutory inspection of the company was conducted by RBI with reference to its financial position as on March 31, 2024. Based on supervisory findings of noncompliance with RBI directions and related correspondence in that regard, a notice was issued to the company advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said directions.

After considering the company’s reply to the notice and oral submissions made during the personal hearing, RBI found, inter alia, that the following charge against the company was sustained, warranting imposition of monetary penalty:

The company had: i) failed to submit credit information of its customers to any of the Credit Information Companies (CICs); ii) transferred a loan exposure to other than a permitted entity; iii) failed to assign Unique Customer Identification Code (UCIC) to its customers; iv) failed to carry out risk categorisation of its customers.

This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered by the company with its customers.