Business Update18 Oct 2024, 02:33 pm
RBI Directs Asirvad Micro Finance, a Manappuram Finance Subsidiary, to Cease Loan Sanctioning Over Pricing Concerns
AI Summary
The Reserve Bank of India (RBI) has directed Asirvad Micro Finance Limited (AMFL), a material subsidiary of Manappuram Finance Ltd., to cease and desist from sanction or disbursal of loans effective from close of business on October 21, 2024. The decision comes after the RBI found material supervisory concerns in AMFL's Pricing Policy, which were excessive and not in adherence with the regulations.
Key Highlights
- RBI directs Asirvad Micro Finance Limited, a Manappuram Finance subsidiary, to cease loan sanctioning and disbursal.
- The directive is based on material supervisory concerns observed in AMFL's Pricing Policy, which were found to be excessive and not in adherence with RBI regulations.
- AMFL can continue servicing existing customers and carrying out collection and recovery processes in accordance with regulatory guidelines.
- The business restrictions will be reviewed by the RBI upon receipt of confirmation from AMFL regarding suitable remedial action.
- Manappuram Finance is currently studying the order passed by the RBI and AMFL is taking necessary steps to swiftly resolve the issues raised.