Document title: RBI Imposes Monetary Penalty on Northern Arc Capital Limited
Issuing authority: Reserve Bank of India
Reference number: Press Release 2026-2027/896
Date: 14 August 2026
Regulatory and Policy Measures
The Reserve Bank of India, by an order dated 14 August 2026, imposed a monetary penalty of ₹6.20 lakh on Northern Arc Capital Limited for non‑compliance with RBI directions on disclosures in financial statements – notes to accounts – and on the internal ombudsman framework. The penalty is imposed under the powers conferred by section 58G(1)(b) read with section 58B(5)(aa) of the Reserve Bank of India Act, 1934.
The RBI’s statutory inspection examined the company’s financial position as of 31 March 2025. Following a notice to show cause, the company’s written reply, additional submissions and oral arguments at a personal hearing were considered. The RBI sustained two charges: (i) the company did not disclose correct and complete information about customer complaints in its annual financial statements for FY 2024‑25; and (ii) it failed to ensure automatic escalation of certain complaints, partially or wholly rejected by its Internal Grievance Redress Mechanism, to the Internal Ombudsman.
The RBI clarified that the penalty addresses deficiencies in regulatory compliance and does not adjudicate the validity of any transaction or agreement with customers. The monetary penalty is imposed without prejudice to any further action the RBI may initiate against the company.
Chief General Manager Brij Raj signed the press release.