The Reserve Bank of India has issued
an advisory to the public recommending them to thoroughly evaluate their
financial investment decisions, consisting of making deposit with NBFCs.
The FAQs describe in detail the
numerous kinds of monetary entities and the regulations regulating them. They
also have detail where members of public can lodge complaints in case some
financial entity is found to be performing business unauthorized or does not
repay the deposits.
The Frequently asked questions, for
example, state that the Reserve Bank controls Non-Bank Financial Business that
conduct monetary activity as their principal company; it has authorized just a
few Non-bank Financial Business to accept deposits; all bundled entities should
always be authorized to collect deposits either under the Reserve Bank of India
Act 1934 or under the Companies Act, 1956; and it does not control chit fund
activities or Collective Financial investment Schemes (CIS).
The FAQs also state that a detailed
list of NBFCs authorized by the Reserve Bank to accept deposits is available on
the RBI site (www.rbi.org.in? Sitemap? NBFC List? List of NBFCs Permitted to
Accept Deposits) and has advised the members of public to inspect the list
before placing deposits with Non-Banking Financial companies.
The Reserve Bank has actually been,
on a number of events in the past, through news release and with its outreach
and sensitization programs performed by its Regional Offices, cautioning the
public not to fall prey to make-believe offers promising unsustainable returns
by individuals, unincorporated bodies and companies.
The RBI Frequently asked questions
likewise recommend members of public to instantly register their grievances in
case they notice any business accepting deposits unauthorized or not repaying
the principal and/or interest with the local police or with the Economic
Offences Wing of the State Police and in case the entity is a business, then
register grievances with the Registrar of companies.
RBI Advisory on What \* to check
prior to making deposits with NBFCs.
A depositor wanting to place deposit
with an NBFC must guarantee that:.
The NBFC is registered with RBI and
is particularly authorized to accept deposits. This can be inspected from the
list of deposit taking NBFCs published on the RBI internet site –
www.rbi.org.in? Sitemap? NBFC List. The depositor should examine the list of
NBFCs allowed to accept public deposits as well as check that it is not
appearing in the list of companies restricted from accepting deposits.
NBFCs need to conspicuously show the
Certificate of Registration (CoR) released by the Reserve Bank on its site. If
an NBFC is authorized to accept public deposit, the certificate mirrors that.
RBI does not assure the repayment of
deposits accepted by NBFCs.
NBFCs cannot use the name of the RBI
in any manner while conducting their business.
Currently, the optimum interest rate
that an NBFC can pay to a depositor must not exceed 12.5 %. The Reserve Bank,
nevertheless, keeps altering these rate of interest relying on the
macro-economic environment. The Reserve Bank releases the modification in the
interest rates on www.rbi.org.in? Sitemap? NBFC List? Frequently asked
questions.
The depositor must insist on a
correct receipt for every time of deposit placed with the business. The receipt
should be properly signed by an authorised person from the company and must
mention the date of the deposit, the name of the depositor, the amount in words
and figures, rate of interest payable, maturity date and amount.
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