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TopicsReserve Bank of India | NBFCs | RBI RBI observation pointed out that the companies were paying stepped-up incentives andoffered higher commissions (up to 35 per cent) for every successful collection from delinquentborrowers The Finance Industry Development Council (FIDC) has asked its members to revise their codes of conduct and insert graded penalty clauses for repeated breaches, especially those relating to recoveries, by outsourcing agencies. The move comes after RBI red-flagged increasing complaints about alleged high-handed practices by outsourcing agencies

This is probably the first time the regulator has cracked down on lenders onrecovery by coercive methods, which is typically a hallmark of outsourced recoveryagents TopicsReserve Bank of India | RBI | M&M Financial Services The Reserve Bank of India (RBI) on Thursday barred non-banking financial services company Reserve Bank of India (RBI) Mahindra & Mahindra Financial Services (MMFSL) from outsourcing recovery agents, days after a 22-year-old pregnant woman died in Jharkhand’s Hazaribagh while trying to block loan recovery agents

Historical Context Historically, NBFCs have been a vital cornerstone of the Indian financial ecosystem as important financial intermediaries channelizing savings and investments, especially for small-scale and retail sectors as well as underserved areas and unbanked sectors of the Indian economy. Evolution Over the years, NBFCs have evolved given the extensive changes in the regulatory framework for NBFCs in India which have moved from simplified regulations to stringent and extensive regulations as well as towards rationalisation per the currently revised NBFC

NBFC has more than Rs 2,600 crore in AUM and it has some 200 branches TopicsWarburg Pincus | MSME | Indian lenders Warburg Pincus, the global private equity firm, through its funds will acquire a majority stake in Vistaar Finance, which lends to MSMEs in India, for an undisclosed amount. An affiliate of Warburg Pincus LLC has entered into a definitive agreement to acquire a majority stake in Vistaar, a non-banking financial company (NBFC). Shareholders exiting through deal include WestBridge