Recorded RBI impact
License cancellation
License cancellation · Fresh imposition
Published by RBI
8 Aug 2018
Case Brief
In exercise of powers under Section 45-IA(6) of the RBI Act, 1934, the Reserve Bank of India cancelled the Certificate of Registration of 36 companies. The companies listed in the release are various NBFCs across multiple states. Following the cancellation, they are no longer permitted to transact the business of a Non-Banking Financial Institution as defined in Section 45-I(a) of the RBI Act, 1934.
Why RBI Acted
The Reserve Bank of India cancelled the Certificate of Registration of 36 named companies under Section 45-IA(6) of the RBI Act, 1934. The release states that, as a result, these companies shall not transact the business of a Non-Banking Financial Institution as defined in Section 45-I(a) of the RBI Act, 1934.
Operating Impact
All 36 named companies lose their NBFC registration and cannot legally carry on non-banking financial institution business going forward. Any current or prospective NBFC operations must stop, affecting their customers and counterparties that rely on such regulated financial services.
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
- 36
- Entity Role
- Bulk Member
- Entity Type
- NBFC
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