RBI cautions banks on gold loan disbursals through fintech startups
RBI) has cautioned banks about gold loan disbursals being made through fintech startups, according to people familiar with the matter. The central bank has flagged “concerns with the evaluation process” by these banks and fintechs, especially in cases where the gold is sourced through field agents of companies, one of the persons said. “The regulator has verbally expressed its concerns to a set of banks regarding this and asked them to take corrective actions immediately,” said another person.
Rupeek, IndiaGold and Oro Money are a few of the major players that source gold loans for banks.
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Offering CollegeCourseWebsiteIndian School of BusinessISB Product ManagementVisitIIM KozhikodeIIMK Advanced Data Science For ManagersVisitMITMIT Technology Leadership and InnovationVisitCautioned banks are in conversations with fintech firms for fixing these issues and could explore pausing business temporarily to ensure complete compliance, the people said.
‘Possible Overvaluation’
Sumit Maniyar, cofounder of Rupeek, which is backed by Peak XV Partners and Accel, said he has not received any communication from his company’s banking partners on this.
“RBI has been closely scrutinising the gold loan business after the IIFL Finance issue,” said one of the persons. “While banks may not have stopped disbursals through fintechs immediately, they are evaluating next steps closely.”
Emailed queries to RBI went unanswered.
The Machinery
Central to the gold loan business is
