RBI has taken strict action against IPPB and a Small Finance Bank. A monetary fine has also been imposed on an NBFC. Let’s know why the central bank took this step and will it also affect the customers?
The Reserve Bank of India (RBI) regulates all banking and non-banking financial institutions across the country. It often takes strict action regarding rules. Now RBI has taken action against India Post Payments Bank and Equitas Small Finance Bank.
The central bank has imposed a fine of Rs 26.70 lakh on India Post Payment Bank (IPPB). A monetary penalty of Rs 65 lakh has been imposed on Equitas Small Finance Bank for ignoring the guidelines. Apart from this, RBI has imposed a fine of Rs 3.10 lakh on Aptus Finance India Private Limited.
The company violated these rules
Aptus Finance India Private Limited did not take prior written permission from RBI before making changes in the management. Due to which 30% of its directors changed except the independent directors. Correspondence related to the information of appointment of directors revealed deficiencies in compliance with the instructions, after which the central bank has issued a show cause notice. After investigation, it was decided to impose a fine.
Why did RBI take strict action against banks?
IPPB upgraded some savings bank accounts without the consent of the customers. Annual charges were also levied after the upgradation of accounts. RBI decided to impose a fine after the allegations were confirmed. Equitas Small Finance Bank imposed foreclosure charges on some floating rate term loans approved by individual borrowers for purposes other than business. Collateral security was obtained for some loans with amounts up to Rs 1.6 lakh. This action of the Reserve Bank of India is based on deficiencies in compliance with the rules. It will not affect the transactions or agreements taking place between the customers.
