RBI cancels registration of 120 non-bank lenders

RBI has put 50 non-bank lenders under close monitoring and has cancelled the registrations of another 120 of such lenders for non-compliance of norms.

According to RBI, it has tightened the on-site supervision of non-banking financial companies (NBFCs) during the year, including stricter coverage of core investment companies and government-owned companies along with “incisive on-site supervision of smaller NBFCs”.

RBI is also planning to undertake a scale-based approach for the regulation of Non-Banking Financial Companies (NBFCs) in a bid to identify a small set of so-called ‘systemically significant’ non-bank financiers, which can potentially affect the financial stability.

It will also be taking steps for improving the effectiveness of supervision and monitoring of NBFCs by firming the quality of Ind-AS implementation and subsequent regulatory guidance directions. Further, it plans to promote tough compliance and risk culture within non-banks, and monitor NBFCs for not compliant with its directions on the maintenance of adequate net owned funds (NOF) and returns filing.