RBI imposes penalty of Rs. 10.4 lakhs on HP Financial Services

HP Financial Services failed to form an IT Strategy Committee and an IT Steering Committee. 

RBI imposes penalty of Rs. 10.4 lakhs on HP Financial Services

 Reserve Bank of India has imposed a penalty of Rs. 10,40,000/- on Hewlett Packard Financial Services (India) Pvt. Ltd. (‘HP Financial Services’) for non-compliance with certain provisions of the ‘RBI Know Your Customer (KYC) Directions, 2016’, ‘Non-Banking Financial Company — Systematically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016’ and Master Directions for ‘Information Technology Framework for the NBFC Sector’ issued by RBI. 

After considering its reply, RBI found that the following charges against HP Financial Services were sustained-

 

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HP Financial Services failed to put in place a periodic review of risk categorization of accounts, and failed to disclose and explicitly communicate the rate of interest, the approach for gradations of risk and the rationale for charging different rates of interest from different categories of borrowers in the loan application form and the sanction letter;

HP Financial Services failed to form an IT Strategy Committee and an IT Steering Committee. 

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