The Reserve Bank of India (RBI) has, by an order dated September 13, 2023, imposed a monetary penalty of ₹1.55 lakh (Rupees One lakh fifty-five thousand only) on Nido Home Finance Limited (formerly known as Edelweiss Housing Finance Limited) (the company) for non-compliance with certain provisions of the Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021. This penalty has been imposed in exercise of powers conferred on RBI under the provisions of clause (b) of sub-section (1) of Section 52A read with clause (aa) of sub-section (3) of Section 49 of the National Housing Bank Act, 1987.

This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the company with its customers.

Background

The correspondence pertaining to the transfer of certain shares of the company between its two group companies revealed, inter alia, the company’s failure to obtain prior written permission of RBI for change in its shareholding due to progressive increases over time, resulting in acquisition of shareholding beyond the permitted limit. Consequently, a notice was issued to the company advising it to show cause as to why penalty should not be imposed on it for failure to comply with the RBI directions, as stated therein.

After considering the company’s reply to the notice, 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.

(Yogesh Dayal)     
Chief General Manager

Press Release: 2023-2024/933