RBI Fines Manappuram Finance Rs 20 Lakh for KYC Norms Violation

The Reserve Bank of India (RBI) has fined Manappuram Finance Rs 20 lakh for failing to comply with Know Your Customer (KYC) norms. The non-banking financial company did not verify customers' PANs and issued multiple identification codes instead of a unique one for each customer.

The Reserve Bank of India (RBI) has imposed a penalty of Rs 20 lakh on Manappuram Finance due to non-compliance with specific provisions of Know Your Customer (KYC) norms. The action followed a statutory inspection referencing the company's financial position as of March 31, 2023.

Following the inspection, RBI issued a notice to Manappuram Finance and reviewed their explanation. However, the bank found that the company failed to verify customer PANs using the issuing authority's verification facility upon customer acceptance and assigned multiple identification codes to certain customers, contravening the requirement of a Unique Customer Identification Code (UCIC).

The penalty, imposed by an RBI order dated December 16, highlights deficiencies in regulatory compliance. RBI clarified that this action should not be seen as a stance on the legitimacy of any transaction or agreement made by Manappuram Finance.

(With inputs from agencies.)