Recorded RBI impact
License cancellation
License cancellation · Fresh imposition
Published by RBI
29 Oct 2018
Case Brief
The Reserve Bank of India cancelled the Certificate of Registration of 31 companies under Section 45-IA(6) of the RBI Act, 1934. The named entities span multiple states, with many based in Kolkata, and the release explicitly says that these companies shall not transact the business of a Non-Banking Financial Institution under the Act. This is a licensing cancellation affecting all 31 listed NBFCs.
Why RBI Acted
The Reserve Bank of India exercised its powers under Section 45-IA(6) of the RBI Act, 1934 to cancel the Certificate of Registration of 31 companies. The order lists the affected companies and states that, as such, the above companies shall not transact the business of a Non-Banking Financial Institution as defined in clause (a) of Section 45-I of the RBI Act, 1934.
Operating Impact
The 31 affected companies must stop conducting NBFC business immediately and cannot legally transact as non-banking financial institutions. Customers and counterparties dealing with them in an NBFC capacity are impacted, and the cancellation removes their RBI registration going forward.
Regulatory Basis
- Section 45-IA (6) of the Reserve Bank of India Act, 1934
- Section 45-I of the RBI Act, 1934
Action Facts
- Primary Impact
- License cancellation
- Entities Affected
- 31
- Entity Role
- Bulk Member
- Entity Type
- NBFC
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