Mahindra and Mahindra Financial Services on Wednesday said the Reserve Bank of India (RBI) has lifted the restrictions imposed on the company regarding using of third-party loan recovery agents.
"Based on the submissions made by the Company and its commitment to strengthen its recovery practices and outsourcing arrangements, tighten the process of onboarding third party agents and strengthen accountability framework as per its Board approved action plan, the RBI, vide its letter dated 4th January 2023, has informed the Company of its decision to lift the aforementioned restrictions imposed on the Company with immediate effect," Mahindra and Mahindra Financial Services said in a regulatory filing to the stock exchanges.
On September 22, 2022, the RBI had directed Mahindra and Mahindra Financial Services Limited to immediately cease any recovery or repossession activity through outsourcing arrangements, till further orders.
However, RBI had then allowed the non-banking financial company to carry out recovery or repossession activities, through its own employees.
The action by the central bank in September was based on certain material supervisory concerns observed in the NBFC, with regard to the management of its outsourcing activities.
( With inputs from ANI )
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