Recorded RBI impact
Fine: Rs 15,000
Monetary penalty · Fresh imposition
Published by RBI
21 Feb 2025
Case Brief
By an order dated February 17, 2025, RBI imposed a monetary penalty of ₹1.50 lakh on JM Financial Home Loans Limited. The penalty was issued after a statutory inspection and subsequent show-cause process found that the company had not disclosed, in its application forms, the approach for gradation of risk and the rationale for charging different interest rates to different categories of borrowers, and had also failed to communicate this explicitly in sanction letters. RBI stated that the action was taken for non-compliance with the Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021, under Section 52A of the National Housing Bank Act, 1987.
Why RBI Acted
RBI imposed a monetary penalty under Section 52A of the National Housing Bank Act, 1987 after a statutory inspection and supervisory review found non-compliance with certain provisions of the RBI's Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021. The sustained charge was that JM Financial Home Loans Limited did not disclose to customers, in its application forms, the approach for gradation of risk and the rationale for charging different rates of interest to different borrower categories, and also failed to communicate the same explicitly in sanction letters.
Operating Impact
The company must absorb the penalty and address the disclosure deficiencies identified by RBI in its customer documentation and sanctioning process. The action does not invalidate existing transactions, but it signals regulatory scrutiny and may lead to further supervisory action if compliance gaps persist.
Regulatory Basis
- Section 52A of the National Housing Bank Act, 1987
Action Facts
- Primary Impact
- Fine: Rs 15,000
- Order Date
- 17 Feb 2025
- Effective From
- 17 Feb 2025
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- NBFC