RBI Imposes Ban on IIFL Finance’s New Gold Loans Due to Irregularities: IIFL Finance can no longer offer new gold loans, as the Reserve Bank of India (RBI) has imposed an immediate halt due to irregularities found in its gold loan portfolio. However, the company will continue to service existing gold loan customers.
The RBI highlighted several irregularities in the company’s gold loan portfolio, including issues with purity and weight checks during loan approval and defaults, as well as violations related to loan-to-value ratios. Despite ongoing discussions with the company’s senior management and auditors in recent months, no meaningful corrective action has been taken, necessitating this ban in the interest of customer welfare.
RBI Imposes Ban on IIFL Finance’s New Gold Loans Due to Irregularities.
IIFL Finance Limited is a financial services company that offers various types of loans through its subsidiaries, including home loans, gold loans, business loans, loans against property, and microfinance. The company has over 2,600 branches in more than 500 cities across India.
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What is Gold Loan?
A gold loan is a loan where you use your gold jewelry or ornaments as collateral to borrow money from a lender. You give your gold to the lender, and in return, they give you cash. The amount you can borrow is usually a percentage of the value of your gold. If you can’t repay the loan, the lender can sell your gold to recover the loan amount. Gold loans are often used for short-term financial needs.
