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RBI launches Ombudsman Scheme for NBFCs

The scheme will provide a cost-free and expeditious complaint redressal mechanism relating to deficiency in the services by NBFCs.

Feb 26, 2018 10:02 IST
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The Reserve Bank of India (RBI) launched ‘Ombudsman Scheme’ for non-banking financial companies (NBFC) for redressal of complaints against them.

As per the RBI, this Scheme will offer a speedy and cost-free complaint redressal mechanism relating to deficiency in the services by NBFCs covered under the Scheme.

The Scheme will be known as ‘Ombudsman Scheme for Non-Banking Financial Companies, 2018’.

RBI notification

According to the apex bank, the Scheme will cover all deposit-taking NBFCs for now and based on the result and experience gained, it would extend the scheme to cover those NBFCs who have the asset size of Rs. 100 crore and above with customer interface.

The Ombudsman Scheme will provide an Appellate mechanism under which the complainant/ NBFC has the option to appeal against the decision of the Ombudsman before the Appellate Authority.

The NBFC ombudsmen will function and the complaints of customer as per zone wise. For this NBFC ombudsmen will discharge their functions from four offices in Chennai, Mumbai, Kolkata and New Delhi.

As per the RBI notification, for redressal of grievance under Ombudsman Scheme, the complainant must first approach the concerned NBFC.

NBFC Ombudsman will not charge any fee for filing and resolving customers’ complaints.

If the NBFC does not reply within a period of 30 days (one month) after receipt of the complaint from complainant or the NBFC rejects the complaint, or if the complainant is not happy with the reply given by the NBFC, then the complainant can file the complaint with the NBFC Ombudsman.

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Non-Banking Financial Company (NBFC)

Non-Banking Financial Company (NBFC) means a ‘non-banking financial company’, as defined in Section 45-I(f) of the Reserve Bank of India Act, 1934, and registered with the Reserve Bank under Section 45-IA of the Reserve Bank of India Act, 1934, which
(a) Is authorised to accept deposits, or
(b) Has customer interface, with assets size of one billion rupees or above as on the date of the audited balance sheet date of the previous financial year, or of any such asset size as the RBI may prescribe.

Types of NBFCs not covered under this scheme

The Non-banking Financial Company (NBFC) - Infrastructure Finance Company (NBFC-IFC), Core Investment Company (CIC), Infrastructure Debt Fund - Non-banking Financial Company (IDFNBFC) and an NBFC under liquidation, are excluded from the ambit of the Scheme.

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