According to the statement issued by the Reserve Bank, under Section 45L (1) (B) of the Reserve Bank of India Act, 1934, Bajaj Finance Limited has been directed to stop the approval and distribution of loans. This order will be applicable to two loan products of Bajaj Finance – ‘Ecom’ and ‘Insta EMI Card’.

According to the Reserve Bank, the company did not follow the existing provisions of digital loan guidelines. These restrictions will be reviewed after addressing the above deficiencies and to the satisfaction of the RBI, the statement said.

Recently RBI has issued comprehensive guidelines related to IT governance and controls for banks and NBFCs. IT governance includes other management including risk management. In this regard, the Reserve Bank of India (Information Technology Governance, Risk, Control and Assurance Practices) Guidelines, 2023 has been issued. The new guidelines will come into effect from April 1, 2024. The instructions state that banks and NBFCs will create a strong IT service management framework.

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