Manappuram Finance Faces a Rs 20 lakh Penalty from the RBI
Manappuram Finance has been fined Rs 20 lakh by the Reserve Bank for failing to comply with several NBFC regulations.
The central bank stated on Friday that this fine against the Thrissur-based gold loan company, which is the second-largest pure-play lender by AUM, is based on the company’s regulatory compliance shortcomings and is not meant to question the legality of any transaction or agreement the company has entered into with its clients.
An examination of the risk assessment report, inspection report, supervisory letter, and all related correspondence pertaining to the same revealed non-compliance with the aforesaid directions to the extent that it did not classify specific gold loan accounts with overdues of more than 90 days as non-performing assets. The Reserve Bank of India (RBI) conducted a statutory inspection of the company regarding its financial position as of March 2021.
Additionally, it did not guarantee that the required loan-to-value ratio would be maintained in certain accounts throughout FY21.
The regulator also said that the company’s inadequate response is the basis for the punitive action.
