RBI orders four NBFCs, including Asirvad Micro Finance, Arohan Financial Services, DMI Finance, and Navi Finserv, to cease loan disbursals due to regulatory violations related to excessive pricing and improper borrower assessment.

Navi Finserv, owned by Sachin Bansal, is among the four NBFCs affected by the Reserve Bank of India's regulatory intervention.

According to the RBI, in addition to charging excessively high prices, these NBFCs were found to be not following regulatory guidelines on evaluating household income and factoring in current or future monthly repayment responsibilities for their microfinance loans.

This action is based on material supervisory concerns observed in the Pricing Policy of these companies, says RBI

The non-banks lenders include former Flipkart founder Sachin Bansal-led Navi Finserv, DMI Finance, Asirvad Micro Finance and Arohan Financial Services. The banking regulator says this action is based on material supervisory concerns observed in the Pricing Policy of these companies in terms of their Weighted Average Lending Rate (WALR) and the Interest Spread charged over their cost of funds,

The Reserve Bank of India has directed Asirvad Micro Finance Limited, Arohan Financial Services Limited, DMI Finance Private Limited, and Navi Finserv Limited to halt loan sanction and disbursement starting October 21,

The RBI has barred Navi Finserv, DMI, Asirvad, and Arohan from issuing new loans, citing excessive interest rates and non-compliance with regulatory norms.

Reserve Bank of India on Thursday issued directions to Asirvad Micro Finance Limited, Arohan Financial Services Limited, DMI Finance Private Limited and Bansal-led Navi Finserv Limited. The RBI has asked the non-banking finance companies to “cease and desist from sanction and disbursal of loans” with effect from next week.

The Reserve Bank of India has banned four NBFCs from issuing new loans starting October 21, 2024, citing excessive lending rates and non-compliance with regulations.