Reserve Bank of India imposes monetary penalty on Bajaj Finance Limited

Case Brief

The Reserve Bank of India imposed a monetary penalty of ₹2.50 crore on Bajaj Finance Limited, Pune, by order dated January 05, 2021. RBI said the company violated directions on Managing Risks and Code of Conduct in Outsourcing of Financial Services by NBFCs and the Fair Practices Code applicable to NBFCs, including a specific direction to ensure full compliance with the FPC in letter and spirit. The regulator found that the company failed to ensure its recovery agents did not harass or intimidate customers during debt collection, and noted persistent or repeat complaints about the company's recovery and collection methods. RBI stated that the penalty was based on regulatory compliance deficiencies and not intended to pronounce on the validity of any transaction or agreement with customers.