Uncharacteristic of NBFCs to seek bank licence: RBI

Mumbai, February 9

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Reserve Bank’s Deputy Governor M Rajeshwar Rao on Friday said it is uncharacteristic of non-bank lenders to seek bank licences when they are already enjoying some regulatory advantages. Addressing a conference on non-bank finance companies (NBFCs) organised by the CII, Rao also hit out at certain microlenders for “misusing” the liberty offered by the regulator on interest rates, and charging high rates.

Rao also expressed displeasure at certain peer-to-peer lending platforms for following business practices which are not in line with the licensing guidelines, and made it clear that such breaches were not acceptable.

He also spoke about the constant demand from NBFCs to convert into banks, and made it clear that regulations for even entities in the top-most tier of NBFCs are not at par with universal banks, and NBFCs enjoy some advantages.

Interestingly, the remarks came right after the speech of Bajaj Finserv’s Chairman and Managing Director Sanjiv Bajaj in which he said NBFCs have grown and become more “solid” courtesy the stronger regulation and supervision by RBI. — PTI

Forex reserves up

India’s forex reserves jumped by USD 5.736 billion to $622.469 billion for the week ended February 2, the Reserve Bank said on Friday. In October 2021, the country’s forex kitty had reached an all-time high of $645 billion.