Banking News

rbi: RBI tells Bajaj Finance to stop loans under ‘eCOM’, ‘Insta EMI’ products

The Reserve Bank of India has directed Bajaj Finance Limited to stop the sanction and disbursal of loans under two of its lending products – ‘eCOM’ and ‘Insta EMI Card’ with immediate effect as the non-banking financial company did not comply with certain norms.

“This action is necessitated due to non-adherence of the company to the extant provisions of Digital lending guidelines of Reserve Bank of India, particularly non-issuance of Key Fact Statements to the borrowers under these two lending products and the deficiencies in the Key Fact Statements issued in respect of other digital loans sanctioned by the company,” the central bank said on Wednesday.

The action taken will be reviewed after Bajaj Finance has rectified the deficiencies to the satisfaction of the RBI, the central bank said.

Over the past few years, the RBI has pulled up some players in the banking and financial services industry for non-compliance with norms, particularly on the digital front.

In December 2020, the RBI had directed private sector banking heavyweight HDFC Bank to cease new activities aimed at building digital businesses and told it to stop taking on new credit card customers after the lender faced multiple data centre glitches.

The central bank had lifted all the restrictions placed on HDFC Bank in March 2022.The RBI had also in March 2022 barred Paytm Payments Bank from adding new customers due to likely gaps in its technology systems.

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