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The Reserve Bank of India (RBI) on Wednesday removed lending restrictions it had imposed on two non-banking financial companies, Asirvad Micro Finance Limited and DMI Finance Private Limited.
The RBI’s decision means both entities can now resume sanctioning and disbursing loans with immediate effect.
The restrictions were originally placed on October 17, 2024, and took effect after the close of business on October 21, 2024. They prevented the two NBFCs from issuing new loans due to concerns about non-compliance with regulatory guidelines and what the central bank described as “usurious pricing.”
Asirvad Micro Finance, a microfinance institution based in Chennai, and DMI Finance, an investment and credit company headquartered in New Delhi, responded by taking remedial actions. They revamped their processes, systems and loan-pricing mechanisms in an effort to ensure full adherence to the RBI’s regulations.
After reviewing the two companies’ compliance reports and revised frameworks, the RBI found them in line with prescribed guidelines.
It noted the firms’ commitment to maintaining fairness in loan pricing and overall compliance going forward, leading the central bank to lift the restrictions. The RBI had earlier lifted similar sanctions on two other NBFCs, Navi Finserv and Arohan Financial Services.
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