RBI bars Bajaj Finance from giving loans via 2 products; here’s what happened

The Reserve Bank of India has barred Bajaj Finance Limited from sanctioning and disbursing loans under its two lending products — eCOM and Insta EMI Card.

In a statement, the apex bank said the company didn’t adhere to the digital lending guidelines under these two lending products. RBI said the “supervisory restrictions” will be reviewed after the NBFC rectifies the violations.

“These supervisory restrictions will be reviewed upon the rectification of the said deficiencies to the satisfaction of RBI,” it said in a statement RBI said in the statement that the company didn’t issue key fact statements to the borrowers under these two lending products.

“The Reserve Bank of India has today, in exercise of its powers under section 45L(1)(b) of the Reserve Bank of India Act, 1934, has directed Bajaj Finance Ltd. (“the company”) to stop sanction and disbursal of loans under its two lending products ‘eCOM’ and ‘Insta EMI Card’, with immediate effect,” it said.

This action is necessitated due to non-adherence of the company to the extant provisions of Digital lending guidelines of Reserve Bank of India, particularly non-issuance of Key Fact Statements to the borrowers under these two lending products and the deficiencies in the Key Fact Statements issued in respect of other digital loans sanctioned by the company,” it added.