RBI imposes monetary penalty on Fairassets Technologies India Private Limited (‘Faircent’)

Case Brief

The Reserve Bank of India imposed a monetary penalty of ₹40 lakh on Fairassets Technologies India Private Limited (Faircent) by order dated February 11, 2025. After a supervisory scrutiny and a show-cause process, RBI concluded that the company had violated provisions of the NBFC–Peer to Peer Lending Platform (Reserve Bank) Directions, 2017. The cited lapses included disbursing loans without individual lenders’ specific approval, failing to disclose borrowers’ credit assessment and risk profile to prospective lenders, taking partial credit risk by foregoing the management fee in a manner not allowed for NBFC-P2P entities, and using an improper fund transfer mechanism that allowed lender repayments through fresh funds or pooled borrower repayments rather than matching a specific borrower to a specific lender. RBI clarified that the penalty is based on regulatory deficiencies and does not pronounce on the validity of any customer transaction or agreement, and that further action may still be initiated.