RBI Rolls out scheme to regulate non-banking financial corporations

To promote conducive culture among the NBFCs and to regulate the credit system of the country, RBI observed that it is necessary to provide for a system of Ombudsman for redressal of complaints against deficiency in services concerning deposits, loans and advances and other specified matters.

Taking note of this, RBI on Friday announced that all NBFCs will come within the ambit of Ombudsman Scheme for Non Banking Financial Companies 2018, and hence, should comply with the provisions of the Ombudsman Scheme for Non Banking Financial Companies 2018. The Reserve Bank may appoint one or more of its officers in the rank of not less than General Manager to be known as Ombudsman to carry out the functions entrusted by or under the Scheme RBI has defined the NBFCs as mentioned in Section 45-I(f) of the Reserve Bank of India Act, 1934, and registered with the RBI. Besides this, the NBFCs should be authorised to accept deposits; or have customer interface, with assets size of one billion rupees or above.

The Non-banking Financial Company - Infrastructure Finance Company (NBFC-IFC), Core Investment Company (CIC), Infrastructure Debt Fund - Non-banking Financial Company (IDF-NBFC) and an NBFC under liquidation, are excluded from the ambit of the Scheme. To begin with, the scheme will be operationalized for all deposit accepting NBFCs and based on the experience gained, the scheme would be extended to include the remaining identified categories of NBFCs. It is initially being introduced at Chennai, Kolkata, Mumbai and New Delhi for handling complaints from the respective zones, so as to cover the entire country. The area of jurisdiction of these offices is indicated in Annex 'I' of the Scheme. The Scheme shall come into effect and force from February 23, 2018.