RBI Cancels Registration of X10 Financial Services Over Irregular Lending Practices

Vide a Press Release No: RBI/2024-25/1967 Mr. Puneet Pancholy, Chief General Manager of the Reserve Bank of India has brought it to the notice of the larger section of the society:

In exercise of the powers conferred under Section 45-IA (6) of the Reserve Bank of India Act, 1934, the Reserve Bank has cancelled the Certificate of Registration (CoR) issued to X10 Financial Services Limited due to irregular lending practices.

As such, the above company shall not, hereinafter, transact the business of a Non-Banking Financial Institution (NBFI), as defined in clause (a) of Section 45-I of the RBI Act, 1934.

The CoR has been cancelled by RBI, as the company has violated RBI guidelines on code of conduct in outsourcing of financial services in its digital lending operations by outsourcing its core decision -making functions such as credit appraisal, fixing of rate of interest as well as Know Your Customer (KYC) verification, to the Service Provider (SP) and failed to conduct due diligence on the SPs.

Courtesy: Reserve Bank of India

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