RBI Directs Bajaj Finance to Halt Loans Under eCOM and Insta EMI Card
The Reserve Bank of India (RBI) has instructed Bajaj Finance to cease the approval and disbursement of loans under its ‘eCOM’ and ‘Insta EMI Card’ lending products with immediate effect. This directive comes as a result of the company’s failure to comply with the existing provisions of the RBI’s digital lending guidelines.
Regulatory Action
In a press release, the RBI highlighted Bajaj Finance’s non-compliance with the digital lending guidelines, specifically citing the company’s failure to issue Key Fact Statements to borrowers for these two lending products. Additionally, deficiencies were noted in the Key Fact Statements issued for other digital loans sanctioned by the company.
Supervisory Restrictions
As a consequence of these shortcomings, the RBI imposed supervisory restrictions on Bajaj Finance. These restrictions will remain in place until the identified deficiencies are rectified to the satisfaction of the RBI. The central bank emphasized that the review of these restrictions will be contingent upon the company addressing the noted issues effectively.
About Bajaj Finance
Bajaj Finance is a prominent non-banking financial company (NBFC) with a substantial customer base of 76.5 million individuals. As of September 30, 2023, the company manages assets worth ₹2.9 lakh crore and maintains a deposit book totaling ₹54,821 crore.
Recent Financial Activities
Earlier this month, Bajaj Finance successfully raised ₹8,800 crore through a qualified institutional placement (QIP), showcasing investor confidence in the company’s growth prospects. However, the recent regulatory action by the RBI underscores the importance of adherence to regulatory guidelines in the financial sector.
As Bajaj Finance works to address the identified deficiencies and regain regulatory compliance, stakeholders will closely monitor the company’s efforts to ensure the integrity and transparency of its lending operations.
