Ujjivan Small Finance Bank Share Price Dips 3.86% Amid ₹6.7 Lakh RBI Penalty

Ujjivan Small Finance Bank has been gaining attention on Monday. On February 17, 2025, Ujjivan Small Finance Bank share price (NSE: UJJIVANSFB) opened at ₹33.19, almost the same as its previous close of ₹33.41.

At 11:43 AM, the share price of Ujjivan Small Finance Bank was trading at ₹32.12, up by 3.86% on the NSE. Notably, the stock price touched its 52-week low recently on January 28, 2025, at ₹30.88.

RBI Imposes ₹6.70 Lakh Penalty

On Friday, post the market hours, the company informed the exchanges that the Reserve Bank of India (RBI) has imposed a monetary penalty of ₹6.70 lakh on Ujjivan Small Finance Bank Limited for non-compliance with specific directions related to ‘Loans and Advances – Statutory and Other Restrictions.’

The penalty was imposed following a statutory inspection by the RBI, which evaluated the bank’s financial position as of March 31, 2023. The inspection revealed that Ujjivan Small Finance Bank had failed to adhere to certain regulatory guidelines regarding the issuance of loan agreements.

The company stated that the penalty was levied under Section 47A(1)(c) of the Banking Regulation Act, 1949, with reference to non-compliance of RBI’s directions. The RBI’s supervisory findings highlighted that the bank had not issued loan agreements to certain borrowers at the time of loan sanction and disbursement, thus violating prescribed norms.

In response, the RBI had issued a show-cause notice to the bank, advising them to explain why a penalty should not be imposed. After considering the bank’s reply, supplementary submissions, and oral presentations made during the personal hearing, the RBI concluded that the failure to issue loan agreements warranted the imposition of a monetary penalty.

The company also added that this penalty relates solely to the bank’s non-compliance with regulatory guidelines and does not impact the validity of any transactions or agreements made between the bank and its customers. The RBI’s action is part of its broader efforts to ensure that financial institutions maintain compliance with regulatory standards and adhere to sound banking practices.

The imposition of this penalty also serves as a reminder to other financial institutions to follow RBI guidelines and adhere to the regulatory framework, with further actions possible if necessary.

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