Recorded RBI impact
License cancellation
License cancellation · Fresh imposition
Published by RBI
29 Mar 2016
Case Brief
The Reserve Bank of India cancelled the Certificate of Registration of 22 NBFCs named in the annex to the release. The action was taken under Section 45-IA(6) of the Reserve Bank of India Act, 1934. As a result of the cancellations, the companies are no longer allowed to transact the business of a non-banking financial institution under clause (a) of Section 45-I of the Act.
Why RBI Acted
The Reserve Bank of India cancelled the certificate of registration of 22 non-banking financial companies (NBFCs) listed in the annex, exercising powers under Section 45-IA(6) of the Reserve Bank of India Act, 1934. The release states that, following cancellation of their registration certificates, these companies are not permitted to transact the business of a non-banking financial institution as defined under clause (a) of Section 45-I of the Act.
Operating Impact
The 22 named companies must stop carrying on NBFC business immediately and cannot legally operate as non-banking financial institutions. Customers and counterparties should no longer expect these entities to originate or carry on NBFC activities under their cancelled registrations.
Regulatory Basis
- Section 45-IA (6) of the Reserve Bank of India Act, 1934
- clause (a) of Section 45-I of the Reserve Bank of India Act, 1934
Action Facts
- Primary Impact
- License cancellation
- Entities Affected
- 22
- Entity Role
- Bulk Member
- Entity Type
- NBFC
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