Case Brief
What Happened
The Reserve Bank of India imposed a monetary penalty of ₹5,00,000 on Nido Home Finance Limited for non-compliance with certain provisions of the RBI direction on 'Co-Lending by Banks and NBFCs to Priority Sector'. The action followed a statutory inspection by the National Housing Bank and a show-cause process. RBI found that the company did not ensure that loan agreements clearly captured the co-lending arrangement, including the respective roles and responsibilities of the company and the co-lending bank, and did not disclose the arrangement details upfront to customers or obtain their explicit consent. RBI stated that the penalty is based on supervisory compliance deficiencies and does not pronounce on the validity of any transaction or agreement.