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RBI Directs Mahindra & Mahindra Financial Services To Cease Recovery Through Outsourcing Arrangements
Pallavi Mishra
28 Sept 2022 12:00 PM IST
On 22.09.2022, the Reserve Bank of India (RBI) issued a press release, directing Mahindra & Mahindra Financial Services Ltd. (MMFSL), Mumbai, to immediately cease carrying out any recovery or repossession activity through outsourcing arrangements, till further orders. However, the MMFSL may continue to carry out recovery or repossession activities, through its own employees. It...
On 22.09.2022, the Reserve Bank of India (RBI) issued a press release, directing Mahindra & Mahindra Financial Services Ltd. (MMFSL), Mumbai, to immediately cease carrying out any recovery or repossession activity through outsourcing arrangements, till further orders. However, the MMFSL may continue to carry out recovery or repossession activities, through its own employees. It was further stated that the action was based on certain material supervisory concerns observed in MMFSL, with regard to the management of its outsourcing activities.
Brief Background
Mahindra & Mahindra Financial Services Ltd. (MMFSL) is a part of Mahindra & Mahindra group of companies led by Mr. Anand Mahindra at present. MMFSL is a Non Banking Financial Company (NBFC), which provides Vehicle and Asset Finance to rural Indians and finances the purchase of new and pre-owned tractors, commercial vehicles, construction equipment and two wheelers.
Recently news surfaced that a pregnant woman had died after she was allegedly mowed down under the wheels of a tractor by a recovery agent of MMFSL in Hazaribagh, Jharkhand. The deceased woman's father had taken a loan from MMFSL and the outsourced recovery agents were attempting to recover the same while the incident had taken place.
Press Release: 2022-2023/916
