Recorded RBI impact
Fine: Rs 50,000
Monetary penalty · Fresh imposition
Published by RBI
21 Oct 2024
Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹50,000 on Family Home Finance Private Limited, Mumbai, Maharashtra, for non-compliance with certain RBI directions on Know Your Customer (KYC). The penalty was imposed under section 52A of the National Housing Bank Act, 1987, following a statutory inspection by the National Housing Bank and a subsequent show-cause notice. RBI found that the company had not conducted risk categorisation of customers, reviewed risk categorisation, or performed periodic updation of KYC. The release notes that the penalty is based on regulatory compliance deficiencies and does not pronounce on the validity of the company’s transactions or agreements, and that other action may still be initiated.
Why RBI Acted
RBI imposed a monetary penalty under section 52A of the National Housing Bank Act, 1987 after supervisory findings and a show-cause process. The company was found to have failed to conduct risk categorisation of customers, review their risk categorisation, and carry out periodic updation of KYC, in non-compliance with RBI directions on Know Your Customer (KYC).
Operating Impact
The company must absorb the monetary penalty and address the KYC control deficiencies identified by RBI/NHB. The action does not itself restrict operations, but the underlying compliance gaps may expose the company to further supervisory action if not corrected.
Regulatory Basis
- section 52A of the National Housing Bank Act, 1987
Action Facts
- Primary Impact
- Fine: Rs 50,000
- Order Date
- 17 Oct 2024
- Effective From
- 17 Oct 2024
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- NBFC