RBI penalized Bajaj Finance for using its borrowers’ extreme tactics of recovery and violating general rules and one specific guidance authorized by the regulator.
On Wednesday morning, the share of Bajaj Finance declined 2.5 percent after the apex lender Reserve Bank of India (RBI) imposed a financial penalty of Rs 2.50 crore on the company. RBI penalized Bajaj Finance for using coercive recovery methods from its creditors and violating the general guidelines and one specific direction authorized by the regulator. It was also noticed that Bajaj Finance violated clear guidance to ensure sustainable compliance with the FPC in letter and spirit.
The share price of Bajaj Finance opened higher at Rs 5,123, compared to the previous close to Rs 5,121 today. Afterward, on BSE, the stock dropped 2.5 percent to the day’s low of Rs 4,991. During early trade, the stock also reached an intraday maximum of Rs 5,167.45. In the last 5 days, the stock has dropped 5.64 percent.
Bajaj Finance stock is greater than the moving averages of 50, 100, and 200 days but lower than the moving averages of 5, 20 days.
Over the last week, the stock has fallen 5.9 percent and 5.2 percent since the starting of the year. Besides that, in a month the stock has risen over 2.9 percent. and 25 percent in one year.
“This penalty has been imposed in exercise of powers invested in RBI under the provisions of clause (b) of sub-section (1) of section 58 G read with clause (aa) of sub-section (5) of section 58B of the Reserve Bank of India Act, 1934, taking into account the failure of the company to claim that its recovery agents did not resort to intimidation or humiliation of customers as part of its debt collection operations and thereby failing to comply to the aforementioned directions issued by RBI,” the regulator mentioned in a statement on its website.
This action is centered on regulatory compliance vulnerabilities and is not expected to rule on the validity of any transaction or agreement that the company has signed into with its customers,
The firm’s market capitalization stood at Rs 3. 02 lakh crore as of the session today. The stock reached a high of 52 weeks of Rs 5,372.75 and a low of 52 weeks of Rs 1,783.10.