Reserve Bank of India (RBI) on Wednesday ordered non-bank lender Bajaj Finance to stop sanction and disbursal of loans under two lending products with immediate effect, due to deficiencies in adhering to digital lending guidelines. RBI directed Bajaj Finance to stop sanction and disbursal of loans under its two lending products ‘eCOM’ & ‘Insta EMI Card’.Bajaj Finance did not issue key information to borrowers under the eCOM and Insta EMI Card lending products, which offer small ticket consumer finance, RBI said in a statement. The restrictions will be reviewed after the company rectifies the deficiencies, the RBI added.
The decision results from the company's non-compliance with the Digital Lending Guidelines, specifically the omission of Key Fact Statements for borrowers and deficiencies in those issued for other digital loans. "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," the RBI noted. Once these issues are addressed to the RBI's satisfaction, the supervisory restrictions will be reconsidered. "These supervisory restrictions will be "reviewed upon the rectification of the said deficiencies to the satisfaction of RBI," it said