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The Reserve Bank of India has imposed a monetary penalty of ₹50,000 on Family Home Finance Private Limited, Mumbai, for lapses related to Know Your Customer (KYC) compliance. The order, dated October 17, 2024, was issued under the powers granted to the RBI through section 52A of the National Housing Bank Act, 1987.
The supervisory examination, conducted by the National Housing Bank for the financial years ending March 31, 2022 and March 31, 2023, flagged significant non-compliance with mandated KYC requirements. Following the findings, a show-cause notice was issued to the company seeking justification for the compliance failures.
After reviewing the company’s written response, oral submissions, and additional documents, the RBI upheld several critical lapses. The inspection revealed that the company did not perform mandatory risk categorisation of customers, failed to review the assigned risk categories, and did not carry out periodic KYC updates. These requirements form the backbone of customer due-diligence—an essential layer of cybersecurity, fraud prevention, and anti-money-laundering (AML) controls in India’s financial ecosystem.
The RBI clarified that the penalty relates strictly to regulatory deficiencies and does not comment on the validity of any customer transactions or agreements. The central bank also stated that the monetary penalty is without prejudice to any further supervisory or enforcement actions that may be taken.
This enforcement action underscores the growing regulatory emphasis on data security, identity verification, and risk-based monitoring—foundational components in India’s broader cyber-law and financial-governance framework.
[RBI]