Mumbai/New Delhi, Mar 7 (UNI) The Reserve Bank of India has imposed a monetary penalty on four Non-banking Finance companies (NBFCs) – Rang De P2P Financial Services, Fairassets Technologies India Private Limited (also referred to as Faircent), Visionary Financepeer Private Limited and Bridge Fintech Solutions Private Limited (also referred to as Finzy) for non-compliance with provisions of the NBFC directions.
RBI imposed a monetary penalty of Rs 10 lakh on Rang De P2P Financial Services Limited, the RBI said, adding the company disbursed loans to individual borrowers without the specific approval of individual lenders.
A monetary penalty of Rs 40 lakh was imposed on Fairassets Technologies India Private Limited for disbursing loans without the specific approval of individual lenders, not undertaking and disclosing the credit assessment and risk profile of the borrowers to the prospective lenders, and taking partial credit risk by foregoing the management fee partially / fully, which was not provided under the ‘Scope of Activities’ for NBFC-P2P companies.
The company also did not comply with RBI’s directions on ‘Fund Transfer Mechanism’, when it allowed repayments to lenders from fresh funds provided by new/existing lenders or through repayments pooled from the borrowers, rather than from a specific borrower to a specific lender, the RBI said in a statement.
The RBI has fined Rs 16.60 lakh on Visionary Financepeer Private Limited for non-compliance with certain provisions of the ‘Non-Banking Financial Company – Peer to Peer Lending Platform (Reserve Bank) Directions, 2017’ issued by RBI.
The company, according to RBI, disbursed loans to individual borrowers without the specific approval of individual lenders, and it did not ensure that each individual lender and borrower had signed a loan agreement; it also did not disclose the required details of the borrowers to the lenders. It did not have a board-approved policy for pricing of services provided by it, and the company did not, in certain instances, (a) ensure that its agreements with service providers included clauses to recognise the right of RBI to cause an inspection to be made of the service providers and (b) undertake an annual review of the service providers; and took partial credit risk, which was not provided under the ‘Scope of Activities’ for NBFC-P2P companies.
In the fourth case, the RBI imposed a monetary penalty of Rs 10.00 lakh on Bridge Fintech Solutions Private Limited, also referred to as “Finzy”, for non-compliance with certain provisions of the ‘Non-Banking Financial Company – Peer to Peer Lending Platform (Reserve Bank) Directions, 2017’ issued by RBI.
The company disbursed loans to individual borrowers without the specific approval of individual lenders, took partial credit risk, which was not provided under the ‘Scope of Activities’ for NBFC-P2P companies.
The company, according to RBI, did not, in certain instances, (a) ensure that its agreements with service providers included clauses to recognise the right of RBI to cause an inspection to be made of the service providers, and (b) undertake an annual review of the service providers; and did not conduct periodic review of the compliance of the Fair Practices Code and functioning of the Grievances Redressal Mechanism.
