Tripura to act against unauthorised non-banking bodies

Wednesday, May 26, 2010

AGARTALA - The Tripura government Wednesday decided to take action against unrecognised non-banking financial institutions (NBFIs) which are collecting deposits from people violating the Reseve Bank of India (RBI) guidelines.

“The state government has undertaken an inquiry against the 84 NBFIs functioning in the northeastern state. The state government would also seek advice from the RBI and the finance ministry about the state government’s possible steps,” Finance Minister Badal Choudhury told reporters here.

In recent years, unauthorised NBFIs have mushroomed in the northeastern region. These organisations first take deposits from the people by giving abnormally high rates of interest or profit. And after collecting the money, they close their operations and vanish from the area.

“A large number of depositors have lost their hard earned savings already,” said the minister.

The state government last week asked the Criminal Investigation Department (CID) of the state police to investigate the NBFIs which are allegedly doing business without due recognition from the appropriate authority.

“According to the RBI guideline, no bank or any NBFI can take or give interest more than 12.5 percent against any financial transaction, but some of the NBFIs are collecting and offering 20 percent interest,” Choudhury said.

The state cabinet at a meeting here Tuesday formed a committee, headed by Chief Secretary S.K. Panda, to scrutinise the credentials of the NBFIs and inquire into their functioning. The committee will submit a report to the government at the earliest.

Meanwhile, the finance minister and senior officials held a meeting with the senior RBI officials here to decide on strategies to deal with the NBFIs.

The state government has demanded an increase in interest rate of at least two percent in the various government-run small savings schemes to desist people from depositing money in the unrecognised NBFIs.

The opposition Congress has criticised the Communist Party of India-Marxist led Left Front government for the rise in the number of unauthorised NBFIs.

“The state government had enacted the Tripura Protection of Interest of Depositors (In Financial Establishment) Act 2000, but the government did not taken any action against any of the NBFIs,”

said opposition leader Ratan Lal Nath.

Filed under: Economy

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