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RBI Removes Business Restrictions on Arohan Financial Services Limited.

Banking & Finance | Dated: 07 Jan 2025

On January 3, 2025, the Reserve Bank of India (RBI) lifted the business restrictions on Kolkata (West Bengal)-based microfinance institution Arohan Financial Services Limited after the institution implemented remedial measures and committed to adhering to fair loan pricing.

🎯 Key Highlights:

  • - On October 17, 2024, the RBI had directed four non-banking finance companies (NBFCs) to stop sanctioning and disbursing loans, effective from October 21, 2024.

💡 Other Important Facts:

  • (i) The RBI had found that Arohan Financial Services, along with other NBFCs, was charging excessive interest rates and failing to follow guidelines for assessing household income and considering repayment capabilities for microfinance loans.
  • (ii) While the restrictions on Arohan have been removed, the restrictions on Asirvad Micro Finance Limited (AMFL), a subsidiary of Manappuram Finance Limited, and DMI Finance Private Limited (DFPL) remain in effect.

📚 Test Your Knowledge:

Recently, which organization removed business restrictions on Arohan Financial Services Limited?

Correct Answer: RBI

🚀 Quick Recap:

About RBI

  • Governor : Sanjay Malhotra
  • Headquarter : Mumbai