Bajaj Finance Penalty: The Reserve Bank is very strict about regulatory compliance.
New Delhi. NBFC Bajaj Finance was overwhelmed by customers harassing them for recovery. The Reserve Bank of India (RBI) has imposed a fine of Rs 2.5 crore on Bajaj Finance, a non-banking financial services company. Bajaj Finance is accused of using unfair means to recover from customers, which are against the regulatory rules of the Reserve Bank.
Action taken after customer complaints
The Reserve Bank (RBI) says that there were many complaints from customers against Bajaj Finance. The RBI has taken this action after complaints against Bajaj Finance for the use of recovery and collection methods for recovery and collection. There were also complaints against Bajaj Finance for violation of the Fair Practices Code (FPC). In such a situation, this penalty has been imposed on the company for violating regulatory rules.
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‘Company could not stop harassment of customers’
This action was taken under Bajaj Finance’s powers on reading clause (b) of sub-section-1 of section 58G of the RBI Act, 1934 (RBI Act] 1934) along with clause-aa of sub-section-5 of section-58B. According to the Reserve Bank of India RBI, the company was not able to ensure that when its recovery agents go to extortion from customers, they are not harassed.
Bajaj Finance Failed Regulatory Compliance!
The Reserve Bank had also sent a show cause notice to Bajaj Finance before imposing a fine, in which the Reserve Bank had asked why no penalty should be taken against the company in case of violation of the rules. After this reply, RBI decided that the company should be fined. RBI said that this action is based on deficiencies in regulatory compliance. Also said that the penalty action has no intention of questioning the validity of any transaction or agreement made by the company with its customers.
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