RBI Cancels NBFC Registration Of X10 Financial Services Ltd

The Reserve Bank of India (RBI) in a significant development has cancelled registration of X10 Financial Services Ltd, a non-banking financial company (NBFC), on account of irregularity in its digital lending operations. The company, located in Mumbai, was providing loans through several service providers which mostly included mobile apps likeWecash Technology, XNP Technology, Yarlung Technology, Xinrui International, Omelette Technology, Mad-Elephant Network Technology and Huidatech Technology.

The registration was cancelled as the company violated guidelines on the code of conduct in outsourcing of financial services in its digital lending operations. This included outsourcing of its core decision making functions such as credit appraisal, fixing of rate of interest as well as Know Your Customer verification, to the Service Provider (SP). Additionally, it also failed to conduct due diligence on the SPs.

The certificate of registration was provided by the RBI to the X10 Financial Services Ltd in June, 2015.

The RBI said that the company cannot transact business of a NBFC.