'With immediate effect...': RBI lifts curbs on Sachin Bansal-led Navi Finserv Limited

The Reserve Bank of India (RBI) announced on Monday, December 2, that it has lifted the restrictions imposed on Navi Finserv Limited, a non-banking financial company (NBFC) led by Sachin Bansal.

The decision comes after the company demonstrated significant reforms in its practices and adherence to regulatory guidelines.

“The Reserve Bank has decided to lift the afore-mentioned restrictions placed on Navi Finserv Limited, with immediate effect,” the RBI said in an official press release.

The ban, originally enforced on October 17, 2024, was triggered by "material supervisory concerns" related to loan pricing practices. Navi Finserv, along with three other NBFCs—DMI Finance, Asirvad Micro Finance (backed by Manappuram Finance), and Arohan Financial Services—was barred from sanctioning or disbursing new loans.

The RBI’s scrutiny revealed that these entities had violated regulations concerning their weighted average lending rate (WALR) and the interest spreads charged over their cost of funds. Additionally, breaches extended to non-compliance with the Fair Practices Code, inadequate income assessments, and neglecting borrower repayment capacity norms in microfinance lending.

Following the ban, Navi Finserv initiated a series of corrective measures, revamping its processes and systems to align with regulatory requirements. The RBI acknowledged the company’s efforts, noting its commitment to fairness in loan pricing and adherence to best practices.

The reinstatement of Navi Finserv’s operations marks the end of a challenging period for the NBFC and signals a return to normalcy. As a middle-layer NBFC registered with the RBI, Navi Finserv’s ability to resume lending is expected to bolster its growth trajectory and restore confidence among its stakeholders.