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RBI Lifts Business Restrictions on ECL Finance and Edelweiss ARC.

Banking & Finance | Dated: 27 Dec 2024

In December 2024, the Reserve Bank of India (RBI) lifted business restrictions on two Edelweiss Group entities: ECL Finance Limited and Edelweiss Asset Reconstruction Company (ARC) Limited, both based in Mumbai, Maharashtra. The restrictions were removed after the companies addressed the RBI's concerns regarding their operations.

🎯 Key Highlights:

  • - In May 2024, the RBI exercised its powers under the Reserve Bank of India Act, 1934, and the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (SARFAESI Act), 2002, to impose restrictions on these non-banking financial entities.
  • - The company was directed to cease structured transactions related to wholesale exposures, except for repayment or closure of accounts in its regular course of business.

💡 Other Important Facts:

  • (i) The company was prohibited from acquiring financial assets and restructuring existing Security Receipts (SRs) into senior and subordinate tranches.
  • (ii) The RBI's decision to lift these restrictions signifies the resolution of operational concerns and compliance with regulatory requirements by both entities.

📚 Test Your Knowledge:

Which organization recently lifted business restrictions on ECL Finance and Edelweiss ARC in December 2024?

Correct Answer: RBI

🚀 Quick Recap: