The biggest non-banking financial company in India, Bajaj Finance, has experienced a significant setback. Bajaj Finance has been directed by the Reserve Bank of India to stop issuing loans under two products immediately due to noncompliance with digital lending regulations. The RBI’s directive went into force on Wednesday.
The biggest non-banking financial company (NBFC) in the nation, Bajaj Finance, has experienced a significant setback. Bajaj Finance Ltd. has been directed by the Reserve Bank of India (RBI) to cease lending under its two loan products, the eCOM and Insta EMI cards, immediately. The RBI, which oversees the banking industry, issued this order, and it went into force on Wednesday.
Following the breach of digital lending criteria, the Reserve Bank of India issued a sanction order, stating that “the order was issued because the company did not comply with RBI’s digital lending guidelines.”
The central bank made it clear in its statement that the institution’s failure to adhere to the current rules of the Reserve Bank of India’s guidelines for digital lending was the reason behind the action. The RBI stated that the action was required, particularly since these two loan products do not provide consumers with Key Fact Statements, and the Key Fact Statements that are provided are inadequate in comparison to comparable digital loans.
Action under RBI Act
The Reserve Bank of India Act, 1934, granted the central bank the authority to put certain limitations on Bajaj Finance. These limitations will be reevaluated once the aforementioned flaws have been fixed. The RBI will remove the limitation as soon as the necessary steps are done and approved, according to the central bank. Following the close of trading on Wednesday, the RBI released a statement regarding the actions taken against Bajaj Finance, which
saw a fall and rise
In light of this, Bajaj Finance’s shares, which went public on Thursday, experienced a sharp decline. But after that, they bounced back. The Bajaj Finance shares traded at Rs. 1.15, or 82.75, in the afternoon. It saw an uptick and was trading at Rs 7,307.05 at that point.