RBI cautions investors against illegal finance companies
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The Reserve Bank of India (RBI) on Saturday asked people not to deposit their hard earned money in unauthorised non-banking financial companies (NBFCs) and institutions in the hope of getting hefty returns.
"Please do not fall into the trap of hefty returns in quick succession," said RBI executive director S. Karuppasamy at a financial outreach camp at remote Bagmara village, 135 km north of Tripura capital Agartala.
"The authorities are taking steps against the NBFCs and the unrecognised bodies. Simultaneously, people also must be aware about the nature and appropriateness of those institutions where they have been depositing their money," he said.
The RBI as part of its platinum jubilee celebrations has been organising financial outreach camps in semi-urban, rural and remote areas since 2009 across the country to make people aware about the banking services, dubious activities of NBFCs and institutions, besides bringing all the people under the banking services.
Since 2009, the RBI has held 17 outreach and financial literacy camps in seven northeastern states.
Unauthorised NBFCs have mushroomed in the northeastern region in recent years. They mobilise deposits from people by promising abnormally high rates of interest, at 25 to 30 per cent per annum.
After collecting the money, they shut down their operations and leave the area. "The NBFCs not recognised by the RBI, the Insurance Regulatory Development Authority or the Securities and Exchange Board of India cannot do any monetary business or take deposits from people," Karuppasamy said.
Top nationalised banks, NABARD (National Bank for Agriculture and Rural Development), regional rural bank officials attended an outreach and financial literacy camp at Bagmara, a village with mixed populattion in Tripura's Dhalai district.
The RBI and top bank officials explained to the local people about opening a no-frill (zero balance) account, taking loans from the banks with trouble-free method, increasing credit-deposit ratio and safe deposit of their well-merited money.
In a separate programme in western Tripura, United Bank of India (UBI) chairman-cum-managing director Bhaskar Sen said mainstream banking services would be provided to all unbanked semi-urban, rural and remote areas having population of 2,000 by March this year.
"Of the 72,900 unbanked villages and human habitations, having population of 2,000 or more, across the country, over 65 per cent such areas have already been covered by some form of banking services," Sen told reporters.
"Banks in India will soon start cashless transactions in a big way to boost the market and economy," the UBI chief said.
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