Enforcement - RBI - Reserve Bank of India
Enforcement
About
Reserve Bank of India (the Bank) has the powers to impose penalties on Regulated Entities (REs) under various statutes including the Banking Regulation Act, 1949, the Reserve Bank of India Act, 1934, the Payments and Settlement Systems Act, 2007, the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, the Factoring Regulation Act, 2011, the National Housing Bank Act, 1987 and the Credit Information Companies (Regulation) Act, 2005.
Enforcement Department was set up in April 2017 with a view to separate enforcement action from supervisory process and to put in place a structured, rule-based approach to identify and process the violations by the Regulated Entities of the applicable statutes and the rules, regulations and orders made, directions issued, and conditions imposed thereunder (hereinafter collectively referred to as “laws”) by the Bank and enforce the same consistently across the Bank.
The objective of enforcement is to ensure compliance by the REs with laws, within the overarching principle of ensuring financial stability, public interest and consumer protection. Greater compliance is aimed to be achieved by initiating such enforcement action so as to not only deter those entities which have violated the laws but also have a demonstrative effect on other participants.
The enforcement process would be evidence based, proportionate and predictable, besides being consistent across the Bank. There would be public disclosure of enforcement action taken through press releases.
Legal Framework
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Page Last Updated on: November 23, 2022
