RBI’s tough stand after woman’s death Ban on recruitment of recovery agents of Mahindra Finance
Indian Reserve Bank of India (RBI) Mahindra & Mahindra Financial Services Limited (Mahindra & Mahindra Financial Services Limited) is directed to immediately stop any collection by outsourcing agents. The Reserve Bank of India has directed that these financial service providers can no longer use external recovery agents. The central bank has taken this step after the death of a pregnant woman who was allegedly crushed under the wheel of a tractor by a recovery agent of a finance company in Jharkhand’s Hazaribagh district. In this case, the local police say that the officials of the finance company did not inform the local police station before going to the victim’s house to recover the tractor.
Mahindra expressed grief
Mahindra Group chief Anand Mahindra and company MD Anish Shah expressed grief over the incident. By issuing a letter, he has assured all possible help in this matter. The company said the debt recovery practices would be reviewed by third parties.
23.5% growth in MFI loans
During April-June, the loan portfolio of micro finance institutions grew by 23.5% to Rs. 2.93 lakh crore. 2.85 lakh crore in the March quarter. In comparison, there is an increase of 2.7%. In this, the share of small finance banks is 16.9%.
what was the incident?
The pregnant daughter of a disabled farmer was crushed to death by the employees of a finance company in Hazaribagh, Jharkhand, who forcibly snatched a farmer’s tractor for not paying the tractor installment on time, killing him on the spot. Divyang farmer Mithilesh Mehta had taken a loan from Mahindra Finance for a tractor, the installment of which he could not repay on time.
RBI’s tough stance
The RBI on Thursday directed Mahindra & Mahindra Financial Services Ltd to immediately stop any collection by outsourcing agents. The central bank has directed that financial service providers can no longer use recovery agents.