New Delhi: The Reserve Bank of India (RBI) said on August 8 that it had issued monetary penalties on nine firms, including Spandana Sphoorty Financial Limited, after the agency discovered multiple infractions in the regulatory compliance process.

Eight of the nine organisations that were penalised are cooperative banks. These include the Yavatmal Urban Cooperative Bank Ltd., the Goa State Cooperative Bank, the Garha Cooperative Bank, and the Chhattisgarh Rajya Sahakari Bank Maryadit.

The RBI stated that the action against Spandana Sphoorty was due to the company’s violation of the pricing of credit criteria for Non-Banking Financial Company-Micro Finance Institutions.

In addition, the company was given notice to provide justification for why a fine shouldn’t be levied against it for failing to follow RBI instructions, according to the RBI.

“After considering the company’s reply to the notice, examination of additional submissions made by it and oral submissions made during the personal hearing, RBI came to the conclusion that the charge of non-compliance with the aforesaid RBI directions was substantiated and warranted imposition of monetary penalty,” the central bank said.

Spandana was hit with a fine of Rs 2.33 crore by the RBI.

Jil Sahakari Kendriya Bank, Maryadit, Warud Urban Cooperative Bank, Indapur Urban Cooperative Bank, and Mehasana Urban Cooperative Bank are more banks that have received sanctions from the RBI.

The Enforcement Department is in charge of running the RBI’s enforcement operations. In order to segregate enforcement action from the supervisory process, the RBI established the EFD in April 2017. From the inspection reports, risk assessment reports, and scrutiny reports, EFD determines infractions that require action.

Market intelligence data, referrals from high management, and complaints are also employed for investigation. The offences are subsequently judged by an adjudication committee, which also establishes the severity of the penalty. The fine resulting from this action would be announced by the RBI in a press release and by the regulated entity in accordance with the disclosure requirements. The regulated entity will then have a certain amount of time to pay the fine.