NBFC: In a statement issued by the Reserve Bank, it was said that after the cancellation of the registration certificate, both NBFCs cannot do business of Non-Banking Financial Institutions (NBFIs).
Reserve Bank of India: The Reserve Bank of India (RBI) has taken strict action against two Non-Banking Finance Company (NBFC). It was informed by the RBI that the registration of Pune-based Kudos Finance and Investments Limited (Kudos Finance and Investments Pvt Ltd) and Mumbai-based Credit Gate Pvt Ltd. has been cancelled. Both NBFCs were involved in regulatory lapses in lending.
The registration certificate was canceled
The statement issued by the Reserve Bank (RBI) said that after the cancellation of the Certificate of Registration (CoR), both NBFCs (NBFCs) cannot do business of Non-Banking Financial Institutions (NBFIs). The central bank said, ‘… the registration certificate of NBFC has been cancelled. The registration has been canceled due to violation of RBI guidelines on outsourcing and fair dealing activities in the work of digital loan operations through third party apps.
Had done undue harassment to the customers
According to RBI both the above mentioned NBFCs were also not following the extant rules related to charging more interest. Along with this, undue harassment was done to the customers regarding loan recovery. In early February, the RBI imposed a fine of Rs 42.48 lakh on Krazybee Services Pvt Ltd. The matter of harassing the customers at the time of loan collection by the recovery agent of Crazybee came to the fore.
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