RBI cancels registration of 23 NBFCs

Reserve Bank of India (RBI).

Mumbai,  The Reserve Bank of India has cancelled the certificate of registration of 23 non-banking financial companies (NBFCs).

According to the apex bank, the registrations were cancelled between May 10 and June 11.

The move has impacted companies such as Prudent Fintrade, Deluxe Vyapaar and Intimate Finance and Investment, among others.

In terms of regulations, section 45-IA of the RBI Act stipulates that no NBFC can commence business of a non-banking financial institution without obtaining a certificate of registration from the RBI and without having net owned funds of Rs 25 lakh (Rs 2 crore for new registration).

The move comes after the sector faced a severe liquidity crisis following the collapse of IL&FS.