Harshreejee Finance & Leasing Company Pvt. Ltd.

Registered Office: 202, Second Floor, Chaudhary Complex, Plot No. 9, Veer Savarkar Block, Shakarpur, East Delhi – 110092

(Approved by the Board of Directors on ____________)

1. PREAMBLE

This Risk Management Policy (“the Policy”) has been formulated and adopted by Harshreejee Finance & Leasing Company Pvt. Ltd. (“HSFLCL” or “the Company”) in compliance with Companies Act, 2013, RBI SBR Directions, 2023, and other applicable regulatory guidelines. The purpose is to establish a robust risk management framework for lending and operational activities.

2. OBJECTIVE

• Safeguard Company’s assets and reputation through prudent risk management practices.
• Define a structured approach to manage all material risks.
• Ensure regulatory compliance, transparency, and accountability.
• Promote a culture of risk awareness across all levels of the organization.

3. SCOPE AND APPLICABILITY

• All business units, operations, and staff of HSFLCL.
• All categories of risks including strategic, financial, operational, technological, and reputational.
• All lending, collection, and customer interaction processes whether digital, branch-based, or third-party.

4. REGULATORY FRAMEWORK

• Companies Act, 2013 – Section 134(3)(n) and related provisions.
• RBI SBR Directions, 2023 – Applicable to NBFC–Base Layer entities.
• Master Directions on IT Framework for NBFCs, 2017.
• Guidelines on Fair Practices, Grievance Redressal, and Internal Control Systems.

5. RISK GOVERNANCE STRUCTURE

• Board of Directors: Ultimate responsibility for oversight, reviews reports, approves Policy annually.
• Director (Risk Oversight): Mr. Tanmay Gupta oversees risk management, implementation, assessment, reporting to Board.
• Functional/Departmental Heads: Identify/manage risks in operations and report to Director (Risk Oversight).
• Internal Auditor: Conducts independent evaluations of controls, reports directly to Board.

6. RISK MANAGEMENT FRAMEWORK

• Credit Risk: Default risk controlled via due diligence, appraisal, verification, post-disbursement monitoring.
• Operational Risk: Mitigated through SOPs, training, segregation of duties, audits.
• Liquidity Risk: Managed with cash buffers, daily monitoring; Director monitors mismatches monthly.
• Market & Interest Rate Risk: Minimized through regular Board reviews.
• Compliance & Legal Risk: Ensured via audits and regulatory compliance.
• IT & Cybersecurity Risk: Protected by firewalls, antivirus, limited access, two-factor authentication, employee training.
• Reputation Risk: Maintained via ethical conduct, transparency, Fair Practice Code adherence.

7. RISK IDENTIFICATION AND ASSESSMENT

Risks identified through reviews, audits, operational monitoring. Likelihood and impact evaluated using risk matrix.

8. RISK APPETITE AND TOLERANCE

Board defines acceptable risk levels; HSFLCL maintains conservative profile with zero tolerance for regulatory/reputational risk.

9. RISK MONITORING AND REPORTING

• Monthly reports to Director (Risk Oversight).
• Significant events escalated immediately to Board.
• Annual consolidated reports reviewed by Board.

10. INTERNAL CONTROLS AND AUDIT INTEGRATION

Internal controls ensure compliance, verified by audits. Findings presented to Board; corrective actions tracked.

11. BUSINESS CONTINUITY AND DISASTER RECOVERY

Backups and contingency plans ensure uninterrupted operations during failures, cyberattacks, or disasters.

12. REVIEW AND AMENDMENTS

Policy reviewed annually or upon regulatory changes. Amendments approved by Board and recorded.

13. APPROVAL

Approved by Board of Directors of Harshreejee Finance & Leasing Company Pvt. Ltd. in meeting held on ____________.
For and on behalf of Harshreejee Finance & Leasing Company Pvt. Ltd.
Director