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Credit Gate Private Limited

NBFCPune, Maharashtra

The RBI action, regulatory basis, and operating impact linked to this entity.

Recorded RBI impact

License cancellation

License cancellation · Fresh imposition

S5

Published by RBI

13 Feb 2023

Case Brief

RBI has cancelled the Certificate of Registration issued to Kudos Finance and Investments Private Limited and Credit Gate Private Limited under Section 45-IA(6) of the RBI Act, 1934. The companies were found to have violated RBI Guidelines on Outsourcing and Fair Practices Code in their digital lending operations carried out through third-party apps, and the conduct was viewed as detrimental to public interest. RBI also noted non-compliance with regulations on charging excessive interest and the use of undue harassment of customers for loan recovery. Following cancellation, the companies cannot carry on the business of a Non-Banking Financial Institution.

Why RBI Acted

Digital lendingFair practicesCustomer protectionLending norms

The Reserve Bank cancelled the Certificate of Registration of Kudos Finance and Investments Private Limited and Credit Gate Private Limited under Section 45-IA(6) of the RBI Act, 1934. The cancellation was on account of violation of RBI Guidelines on Outsourcing and Fair Practices Code in their digital lending operations undertaken through third-party apps, which was considered detrimental to public interest. The companies were also not complying with extant regulations relating to charging excessive interest and had resorted to undue harassment of customers for loan recovery purposes. As a result, they are barred from transacting the business of a Non-Banking Financial Institution under Section 45-I(a) of the RBI Act, 1934.

Operating Impact

The two NBFCs lose their regulatory permission to operate as Non-Banking Financial Institutions and must stop NBFC कारोबार/activities. Borrowers and customers may be affected by disruption to digital lending and recovery practices; the companies are prohibited from transacting NBFI business going forward.

Regulatory Basis

  • Section 45-IA (6) of the Reserve Bank of India Act, 1934
  • clause (a) of Section 45-I of the RBI Act, 1934

Action Facts

Primary Impact
License cancellation
Entities Affected
2
Entity Role
Bulk Member
Entity Type
NBFC

Related Entities

Entities similar to Credit Gate Private Limited

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  1. Kudos Finance and Investments Private Limited

    NBFC · Pune, Maharashtra

    1 shared action

    1 restriction