Recorded RBI impact
License cancellation
License cancellation · Fresh imposition
Published by RBI
9 Feb 2024
Case Brief
The Reserve Bank of India announced cancellation of the Certificate of Registration for nine NBFCs that had surrendered their CoR. The release says the cancellations were made under Section 45-IA(6) of the RBI Act, 1934, with stated reasons including exit from the non-banking financial institution business and, in some cases, the entity ceasing to be a legal entity after amalgamation, merger, dissolution, or voluntary strike-off. The release also states that Reliance Home Finance Limited, a housing finance company, surrendered its CoR granted by the National Housing Bank and RBI therefore cancelled it under Section 29A of the National Housing Bank Act, 1987.
Why RBI Acted
RBI stated that nine NBFCs had surrendered their CoR and, under Section 45-IA(6) of the RBI Act, 1934, their CoR was cancelled. The stated reasons include exit from the NBFI business and, for some entities, cessation as a legal entity after amalgamation, merger, dissolution, or voluntary strike-off. Separately, one Housing Finance Company, Reliance Home Finance Limited, surrendered its CoR granted by the National Housing Bank, and RBI cancelled it under Section 29A of the National Housing Bank Act, 1987.
Operating Impact
These entities are no longer permitted to operate as registered NBFCs/HFCs under their cancelled CoRs. The cancellations take effect from the stated cancellation dates, and the affected entities must cease regulated activities covered by the registration.
Regulatory Basis
- Section 45-IA (6) of the Reserve Bank of India Act, 1934
- Section 29A of National Housing Bank Act, 1987
Action Facts
- Primary Impact
- License cancellation
- Effective From
- 5 Jan 2024
- Entities Affected
- 10
- Entity Role
- Bulk Member
- Entity Type
- NBFC
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