The Reserve Bank of India (“RBI”) had vide a notification dated February 23, 2018, introduced the Ombudsman Scheme for Non-Banking Financial Companies (“Scheme”). The Scheme was initially applicable to all non-banking financial companies (“NBFCs”), which are registered with the RBI under section 45IA of the Reserve Bank of India Act, 1934 and are authorised to accept deposits.
In furtherance to the announcement made in the Statement on Developmental and Regulatory Policies of the Monetary Policy Statement dated April 4, 2019, the RBI has issued a notification bearing Ref. CEPD. PRS. No.4535/13.01.004/2018-19, dated April 26, 2019 (“Notification”), partially modifying the Scheme. Pursuant to the Notification, in addition to the NBFCs already covered under the Scheme, all non-deposit taking NBFCs having customer interface and asset size of INR 100 crore and above, as on date of their last audited balance sheet, was brought within the ambit of the Scheme and required to comply with the provisions of the Scheme.
The Scheme will continue to be operated from the offices of NBFC Ombudsmen currently functioning and addressing grievances at four metro centres viz. Chennai, Kolkata, Mumbai and New Delhi. The Scheme also provides for a mechanism for appeal under which the complainant / NBFC has the option to appeal against the decision of the Ombudsman before the Deputy Governor-in-Charge of the Department of the Reserve Bank implementing the Scheme (the “Appellate Authority” under the Scheme).
The non-banking financial companies – infrastructure finance companies, core investment companies, infrastructure debt fund-non-banking financial companies and NBFCs under liquidation, are excluded from the ambit of the Scheme.
The extension of the Scheme to the aforesaid NBFCs has come into effect from April 26, 2019.
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