RBI Cracks The Whip On HSBC With ₹1.73 Cr Penalty For Misreporting Credit Info

RBI Cracks The Whip On HSBC With ₹1.73 Cr Penalty For Misreporting Credit Info

The Reserve Bank of India (RBI) announced that it has imposed a ₹1.73 crore monetary penalty on The Hongkong and Shanghai Banking Corporation Ltd (HSBC) for violating the Credit Information Companies Rules, 2006.

What Happened? An RBI press release stated that HSBC provided incorrect credit information regarding numerous expired credit cards with zero dues to all four credit information companies.

RBI conducted a Statutory Inspection for Supervisory Evaluation (ISE) of the bank’s financial position as of March 31, 2021, which revealed HSBC’s contravention of the aforementioned rules.

The central bank then issued a notice to HSBC, asking the bank to show cause as to why they should not face a penalty for violating the Credit Information Companies Rules.

See also: Powering Up For IPO: India’s Largest Wire Exporter Seeks SEBI Approval To Raise Funds

After examining the bank’s response to the notice and listening to its oral submissions during a personal hearing, RBI determined that the bank had substantiated the contravention and warranted a monetary penalty.

The central bank clarified that this action focuses on regulatory compliance deficiencies and does not pass judgment on the validity of any transaction or agreement made by the bank with its customers.

RBI imposed the penalty using its powers under Section 25 (1) and Section 23 (4) of the Credit Information Companies (Regulation) Act, 2005.

Do not miss: What Is Swiggy Share Price And How To Buy?

Posted In: GovernmentRegulationsHSBCRBI