RBI imposes monetary penalty on NABFINS Limited, Bengaluru

Case Brief

By an order dated April 15, 2024, RBI imposed a monetary penalty on NABFINS Limited, Bengaluru, a subsidiary of NABARD, for non-compliance with certain provisions of the NBFC-Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016. Following a statutory inspection, supervisory findings, a show-cause notice, and consideration of the company's reply and submissions, RBI sustained the charge that NABFINS had forced customers to choose only a particular insurance company in relation to assets financed by it. RBI said the penalty was imposed under section 58G read with section 58B(5)(aa) of the RBI Act, 1934 and that the action is without prejudice to any other action that may be initiated.