RBI imposes monetary penalty on Progfin Private Limited

Case Brief

The Reserve Bank of India imposed a monetary penalty on Progfin Private Limited after a statutory inspection and a subsequent show-cause process. RBI found that the company had not put in place a system for periodic review of the risk categorisation of accounts, with the review frequency required to be at least once in six months, which amounted to non-compliance with the RBI (Know Your Customer (KYC)) Directions. The penalty was imposed under the RBI Act, 1934, and the release clarifies that the action is based on regulatory compliance deficiencies and does not pronounce on the validity of any customer transaction or agreement.