The Reserve Bank of India (RBI) has taken action against four Non-Banking Financial Companies (NBFCs), including microfinance institutions, due to concerns over their lending practices. These companies—Asirvad Micro Finance, Arohan Financial Services, DMI Finance, and Navi Finserv—have been ordered to stop issuing new loans starting October 21, 2024.
The RBI’s decision stems from issues related to the high lending rates and interest charged were found to be excessive and not according to the regulations issued by the RBI set in 2022.
However, the companies are still allowed to service existing customers and carry out collections. This move highlights the RBI’s focus on ensuring fair practices and stability in the financial sector.
