The Reserve Bank of India (RBI) forbade Mahindra Finance from carrying out any recovery or repossession action through outsourcing arrangements on Thursday. But the bank regulator said that the company could keep using its own staff to carry out recovery actions.
The RBI said, “This action is based on a number of the material supervisory concerns found in the said NBFC about how its outsourced activities were being managed.”
The RBI’s action came only days after a pregnant woman, Monika Devi, was crushed to death under the wheels of a tractor that was being dragged away by recovery agents in Jharkhand’s Hazaribagh district.
Roshan Singh, a 26-year-old male, was later apprehended by Hazaribagh Police. According to Hazaribagh SP Manoj Ratan Chothe, Singh is the financing company’s third-party vendor. “Roshan is one of the four people identified in FIR filed after Monika Devi’s death,” Ichak police station officer-in-charge Dhananjay Singh said.
According to the agency report, a family member of the deceased alleged that when her father, Mithilesh Mehta, asked to see confirmation of their identification, the recovery agents and the manager of Mahindra Finance became enraged. The family member further stated that the agents called Mithilesh and asked him to return the Rs 1.30 lakh debt.
The recovery agency allegedly requested that Mithilesh pay the full sum or the tractor would be taken away. Mithilesh allegedly offered to pay Rs 1.20 lakh right now. However, the agents refused to accept it and proceeded to seize the tractor. Monika Devi’s father had hurried to the scene to stop the agents, but she was crushed under the vehicle’s wheels.
The Reserve Bank of India (RBI) is India’s central bank and the regulatory body in charge of monitoring the Indian financial industry. It is owned by the Government of India’s Ministry of Finance. It is in charge of controlling, issuing, and maintaining the Indian rupee supply. It also manages the country’s major payment networks and tries to promote economic growth.
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