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RBI cancels registrations of 5 NBFCs due to irregular lending practices

The Reserve Bank of India has cancelled  certificate of registration (CoR) issued to five NBFCs on account of violation of the RBI guidelines on outsourcing and fair practices code in their digital lending operations undertaken through third party apps, which was considered detrimental to public interest. CoRs of UMB Securities, Anashri Finvest, Chadha Finance, Alexcy Tracon and Jhuria Financial Services have been cancelled.

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. As such, the above companies shall not transact the business of a Non-Banking Financial Institution (NBFI), as defined in clause (a) of Section 45-I of the RBI Act, 1934.

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