RBI imposes Monetary Penalty on M/s Kosamattam Finance Ltd

Case Brief

RBI imposed a monetary penalty on M/s Kosamattam Finance Ltd. after an inspection under section 45N of the RBI Act, 1934 found violations of the Bank’s KYC guidelines and RBI directions/orders issued from time to time. Following a show cause notice and a personal hearing, RBI concluded that the violations were substantiated and imposed a penalty of ₹5 lakh under the RBI Act.

Action Snapshot

Primary Impact: Fine: Rs 5.00 L
Entity Type: NBFC
Action Type: Monetary penalty
Order Date

Unknown date

Effective From

Unknown date

Entities Affected

1

Why RBI Acted

KYC / AML

RBI conducted an inspection of the company under section 45N of the RBI Act, 1934 during August 2016 and found violations of the Bank’s KYC guidelines and directions/orders issued by RBI from time to time. A show cause notice was issued on April 28, 2017, and after considering the company’s reply and personal hearing submissions, RBI concluded that the violations were substantiated and warranted monetary penalty under section 58G(1)(b) read with section 58B(5)(aa) of the RBI Act, 1934.

Severity Assessment

The action is a monetary penalty of ₹5 lakh, which falls in the lowest monetary band and carries no additional operational restriction.

Impact

The company must absorb the monetary penalty; the release does not describe any operating restriction, suspension, or cancellation. The adverse impact is limited to the fine itself, with no stated immediate effect on customers or operations.

Regulatory Basis

section 58G(1)(b)
sub-section 5(aa) of section 58B
section 45N of Reserve Bank of India Act, 1934
section 58G (2) of the RBI Act, 1934

Affected Entities

M/s Kosamattam Finance Ltd
Published as M/s Kosamattam Finance Ltd.
NBFC · Primary