MUMBAI: The Reserve Bank on Wednesday revoked the registration certificates of four non-banking financial institutions offering fast, no-cost loans through digital apps. The RBI took the action following growing complaints of intimidation and harassment for loan collection. The Reserve Bank has taken action against four Non-Banking Financial Companies (NBFCs), namely Properties and Finance Company, North East Region Finance Services, Sogenvi Finance and Opal Finance. They will no longer be able to perform any type of transactions that NBFCs do, the central bank said. This action was taken under “Section 45I” of the Reserve Bank Act, 1934.
Meanwhile, four non-bank financial companies, namely Ashwini Investments Private Limited, RM Securities, Amity Finance and Matrix Corporation, have canceled their certificates of registration with the central bank. Many companies offer instant loans without any hassle through mobile apps. The loan is sanctioned without verification of the borrower’s financial ability to repay the loan, income level. After that illegal methods like dandagai, dhakdapatsha are adopted for recovery. Recognizing this, the central bank issued guidelines regulating instant digital lending platforms or “lending apps” in August. This will curb the arrogance and arrogance of this app.