New Delhi, Apr 20 (KNN) The Reserve Bank of India (RBI) has cancelled the registrations of two more Non-Banking Financial Companies (NBFCs)  based in Jammu and Punjab.

Certificates of Registrations of Gandhi Nagar, Jammu based The Metropolitan Finance Private Limited
(presently known as The Metropolitan Finance Limited) and Ludhiana, Punjab based M/s Singhland Investments Limited (previously known as M/s Baba Finance Private Limited) have been cancelled by the apex bank.

“Following the cancellation of registration certificate, these companies cannot transact the business of a non-banking financial institution as laid down under clause (a) of Section 45-I of the Reserve Bank of India Act, 1934,”RBI said in a press release on Thursday.

Meanwhile, according to a study report on NBFCs, in the last five years, non-banking financial companies (NBFCs) have witnessed a sharp 5% increase in their non-performing assets (NPAs) and the “static mood” of the realty sector is likely to further increase NPAs of the NBFCs.

The study was conducted by RBI.

A NBFC is a company incorporated under the Companies Act 2013 or 1956 and engaged in the business of loans and advances, acquisition of stocks, equities, debt etc, issued by the government or any local authority.

According to the RBI study on NBFCs, the bad loans of NBFCs work out to be around Rs 74,230 crore. However, the RBI study also attributes the change in NPA recognition norms as a reason for growing NPAs of NBFCs. (KNN Bureau)