RBI cancels registrations of 150 NBFCs
What's the story
The Reserve Bank of India (RBI) has canceled the Certificates of Registration (CoR) of 150 non-banking financial companies (NBFCs). The decision was made under Section 45-IA (6) of the RBI Act, 1934. The central bank said these entities "shall not transact the business of a Non-Banking Financial Institution," as defined under the RBI Act. Around 67 of these NBFCs were registered in Delhi, while about 75 firms were registered in West Bengal.
Regional impact
Companies from other states also affected
The list of affected companies isn't limited to West Bengal and Delhi. It also includes firms from Telangana, Karnataka, Tamil Nadu, Bihar, Haryana, Madhya Pradesh and Rajasthan. Some of the Kolkata-based firms whose registrations were canceled include Akin Vincom, Admire Vinimay, Blue Diamond Securities & Finance, and Taurus Ispat Private. Delhi-based companies such as Goal Securities and Credits, MR Fincap Private, and Paras Fincap are also on this list.
Voluntary surrenders
7 NBFCs voluntarily surrendered CoR
In a separate move, the RBI announced that seven NBFCs have voluntarily surrendered their CoR. Four of these companies, including Ashoka Viniyoga and Guru Kirpa Finvest, have exited the non-banking financial institution business. Two firms—R R Holdings Private Limited and Anjali Capfin Private Limited—no longer require RBI registration after meeting criteria for unregistered Core Investment Companies (CICs).
Registration changes
What else is notable?
The RBI also canceled the CoR of HDFC Holdings Limited after it ceased to exist as a legal entity due to amalgamation, merger, dissolution or voluntary strike-off. However, the central bank restored the CoR of Jaipur-based Krishna Capfin after considering orders passed by appellate authorities and courts. The RBI has directed this company to comply with all applicable provisions of the RBI Act and regulatory reporting requirements in future.