MUMBAI— The Reserve Bank of India (RBI) announced Friday that it has imposed monetary penalties on HDFC Bank and Shriram Finance Limited for non-compliance with certain regulatory directives.
HDFC Bank has been fined ₹4.88 lakh for violating provisions under the Foreign Exchange Management Act (FEMA). According to the RBI, the penalty was imposed after the private sector lender failed to adhere to the guidelines laid out in the Master Direction – Foreign Investment in India while extending a term loan to a client.
“The RBI had issued a Show Cause Notice to the bank, to which HDFC Bank responded with a written explanation and oral submissions,” the central bank said in a statement. “After reviewing the case details and the bank’s response, the RBI decided to impose the penalty.”
In a separate case, Shriram Finance Limited, a non-banking financial company (NBFC), was fined ₹2.70 lakh for breaching provisions of the Reserve Bank of India (Digital Lending) Directions, 2025.
The RBI conducted a statutory inspection of Shriram Finance based on its financial position as of March 31, 2024. During the review, the central bank identified non-compliance issues related to digital lending practices.
Specifically, the company had routed loan repayments through a third-party account, rather than requiring borrowers to credit payments directly to Shriram Finance’s account — a violation of RBI guidelines.
“Based on supervisory findings and subsequent correspondence, a notice was issued to the company to show cause as to why a penalty should not be imposed,” the RBI stated. The monetary penalty was officially levied via an order issued on July 8, 2025.
The central bank clarified that the penalties are strictly regulatory actions related to compliance deficiencies and do not impact the validity of any transactions or agreements entered into by the two entities. (Source: IANS)
