RBI canceled Registration of five NBFCs due to irregular lending practices

As such, the above companies shall not transact the business of a Non-Banking Financial Institution (NBFI), mentioned by RBI in a release.

RBI canceled Registration of five NBFCs due to irregular lending practices
RBI canceled Registration of five NBFCs due to irregular lending practices

New Delhi: The Reserve Bank of India canceled the Certificate of Registration (CoR) of five Non-Banking Financial Companies (NBFCs) including UMB Securities Limited, Anashri Finvest Limited, Chadha Finance Private Limited (now known as Chadha Finance Limited), Alexcy Tracon Pvt Ltd, Jhuria Financial Services Private Limited.

As such, the above companies shall not transact the business of a Non-Banking Financial Institution (NBFI), mentioned by RBI in a release.

The CoR of the above-mentioned NBFCs have been canceled on account of violation of RBI guidelines on outsourcing and the Fair Practices Code in their digital lending operations undertaken through third-party apps which was considered detrimental to the public interest. 

These companies were also not complying with the extant regulations pertaining to charging of excessive interest and had resorted to undue harassment of customers for loan recovery purposes.