Banking regulator Reserve Bank of India has shown strictness on India’s NBFC business giant Bajaj Finance. RBI has taken action and banned two loan products of Bajaj Finance.
The Reserve Bank of India has ordered it to stop the approval and distribution of loans under Ecom and Insta EMI cards with immediate effect. India’s central bank Reserve Bank of India has issued a statement in this regard.
Bajaj Finance Non-Compliance
According to the Reserve Bank of India, Bajaj Finance has been accused of not complying with the existing provisions of the Digital Loan Guidelines of the Reserve Bank of India. The Reserve Bank of India has said that this necessary action has been taken due to non-issue of key fact statements to the customers under these two loan products of it and deficiencies in the key facts issued in respect of other digital loans approved by the company.
Bajaj Finance Faces RBI Action
RBI has said that important fact statements are not being issued to the people taking loans under these two loan products of it. Along with this, there is a lack in the main fact statement in approving the second digital loan due to which this action had to be taken against Bajaj Finance.
The Central Reserve Bank has said that if it removes these shortcomings and satisfies the RBI by replying, then these restrictions can be reviewed.
Shares Decline After RBI Action
The impact of this action of the Reserve Bank of India has also been seen on the shares of it. After this order of the Reserve Bank, there was a decline in the shares of Bajaj Finance on Wednesday, and it fell by about two percent and closed at the level of Rs 7224.
Stock market experts say that due to this action of RBI on two loan products of Bajaj Finance, the income of it may decrease. Many stock market experts have said that its impact on the business and profits of itcan be seen in the short term.
Many experts have said that this matter can be resolved in the next one or two quarters. Stock market experts say that due to this restriction by RBI on the net profit of Bajaj Finance, there may be a decline of 6 percent.