Navi Finserv Resumes Operations After RBI Lifts Restrictions

On December 2 2024, the Reserve Bank of India (RBI) lifted the restrictions imposed on Navi Finserv, the lending company owned by Sachin Bansal.

This move comes less than two months after the central bank had barred the company from sanctioning and disbursing loans, starting October 21 2024.

Navi was not the only company affected by the RBIs action, three other non-banking financial companies (NBFCs) — DMI Finance, Asirvad Micro Finance, and Arohan Financial Services — were also targeted. The RBIs intervention was prompted by concerns over predatory lending practices, including high interest rates, hidden fees, and the rolling over of loans.

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Commitment to Fair Loan Pricing

The restrictions were lifted after Navi Finserv implemented significant changes to its operations in response to regulatory guidelines. 
Reports indicated that the companys aggressive loan disbursement targets and sales strategies had led to several violations particularly concerning excessive interest rates and ambiguous terms on compounding interest.

In a statement, the RBI mentioned that after multiple interactions with the company and reviewing its corrective actions, including the adoption of revised processes, it was satisfied with Navi Finserv’s commitment to ensuring compliance with regulatory standards, especially regarding fair loan pricing. As a result the restrictions were lifted immediately.

Sachin Bansal who holds a 98 Percent stake in Navi Finserv, expressed gratitude to the RBI for its guidance during the process. He assured that as the company resumes its operations it would continue to prioritize compliance and uphold the highest standards of governance and operational excellence.

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