The Reserve Bank of India has imposed a penalty of ₹3.1 lakh on IIFL Finance for failing to return surplus funds from gold auctions to borrowers. According to the central bank's statement, the penalty was imposed for non-compliance with certain provisions of the Master Direction- Reserve Bank of India (Non-Banking Financial Company - Scale Based Regulation). A statutory inspection of IIFL Finance was conducted with reference to its financial position as on March 31, 2025. The RBI found that the company had failed to pay the surplus amount realised from the auction of pledged gold articles, over and above the loan outstanding, to certain borrowers.
The RBI also imposed a penalty of ₹5.8 lakh on Appnit Technologies for non-compliance with certain directions issued by RBI on Know Your Customer (KYC) and Prepaid Payment Instruments (PPI). As reported by the central bank, Appnit Technologies allowed PPI accounts, opened using Aadhaar OTP based e-KYC, to continue for more than one year without carrying out identification as per KYC Directions. The company also failed to put in place a system of periodic review of risk categorisation of accounts.
According to the RBI's statement, these penalties do not affect customers' existing deals or transactions with the companies. The central bank emphasized that these moves are all about the stated compliance rationale and the non-judgment on customer transactions. In both cases, the RBI penalties are based on deficiencies in statutory and regulatory compliance and are not intended to pronounce upon the validity of any transaction or agreement entered into by the companies with their customers. The RBI's move highlights its commitment to enforcing financial regulations across the financial sector.
