RBI imposes monetary penalty on Asirvad Micro Finance Limited

Case Brief

RBI imposed a monetary penalty on Asirvad Micro Finance Limited by order dated February 20, 2025. The action followed a statutory inspection and a show-cause notice after supervisory findings indicated non-compliance with the Master Direction on the Regulatory Framework for Microfinance Loans, 2022 and RBI’s directions on appointment of an Internal Ombudsman by NBFCs. RBI held that the company failed to report household income of certain borrowers to Credit Information Companies, failed to provide factsheets to certain gold loan customers, and failed to establish auto-escalation of complaints rejected by its internal grievance redress mechanism to the Internal Ombudsman. The penalty does not pronounce on the validity of any customer transaction and is without prejudice to any further action RBI may take.