RBI to set up a portal for consumers to file complaints
“We already have fair practices courts for non-banking finance companies (NBFCs), we will be strengthening that and then we have also put a draft charter for the customer services,” informed Mr N.S. Vishwanathan, executive director, RBI while inaugurating the 2nd national summit on ‘Non-Banking Finance Companies-The way forward,' organised by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).
“In the times to come the NBFC sector should get to becoming even more alive to the issues of the customer rights and protection,” said Mr Vishwanathan.
He further informed that with a view to get greater vigilance to prevent frauds in the NBFC sector, the RBI has enhanced the level of coordination of various agencies involved in regulating the NBFC space.
“We are planning to set up a kind of a portal where information by various regulators who are part of SLCC (state level coordination committee) can be put in and we would also encourage people to file their complaints in that and so that the SLCC is quickly able to look into them and take immediate necessary action,” said Mr Vishwanathan.
RBI would be the host of this portal as it being the convenor, he further said.
The SLCC as an inter-regulatory forum convened by the regional offices of the RBI has been strengthened, it now is chaired by the chief secretary of the state so that all the state entities are coordinated in that, it is meeting more frequently than it was in the past, there are sub-committees which are formed within that basically to see that timely actions are taken, informed Mr Vishwanathan.
He also said that acting upon the suggestion of the Committee on Comprehensive Financial Services for Small Businesses and Low Income Households popularly known as the Nachiket Mor Committee, the RBI is moving move away from entity-based regulation to activity-based regulation by doing away with different categories of NBFCs.
“What this would mean is that you don't look at whether the company is an investment company or an asset finance company but you look at the nature of assets in that company and make the dispensations based on that,” said Mr Vishwanathan.
He also informed that considering the Companies Act 2013 has certain different provisions with regard to the limit on private placement, the RBI is working on aligning the guidelines with the new companies act requirements while at the same time finding ways to address the issues raised by the sector.
On the issue of legislative changes, Mr Vishwanathan said, “In the backdrop of recommendations made by the several working groups, committees and also the FSLRC, we are gaining access to identify the necessary legislative changes required to facilitate more orderly growth of the sector and at the same time address the gaps that are there.”
He further informed that an online reporting for the registered, self-regulatory organisations in the NBFC-MFIs sector is underway.
Talking of an informal sector of non-registered/regulated claiming to be NBFC entities whose functioning has an impact on organised/recognised/registered NBFCs, Mr Vishwanathan said there is a need to ensure that part of the segment is curbed so that the real regulated NBFC sector is able to do its job the way it has to.
He also suggested that registered NBFCs should play a significant role in bringing market intelligence reports to the notice of the bank on an entity engaged in unauthorised deposit taking or such other financial activity. “The bank has strengthened this market intelligence so as to gather information quickly and act on it.”
