Sachin Bansal's Navi Finserv gets RBI approval to disburse pre-October 20 home loans

Earlier this month, The Reserve Bank of India (RBI) has banned Flipkart co-founder Sachin Bansal-led Navi Finserv from loan sanctioning and disbursement processes.

The regulatory action, effective from October 21, 2024, cited “material supervisory concerns” regarding practices such as high pricing.

The decision barred Navi Finserv from loan sanctioning and disbursal activities after this date, impacting many of its customers who were awaiting their loan disbursements.

Navi Finserv’s announcement on home loan disbursals

On Tuesday, Sachin Bansal-led Navi Finserv said that the RBI had granted it permission to proceed with the disbursement of home loans sanctioned before October 20, 2024.

This update affects customers who had their loans approved but not yet disbursed before the regulatory order took effect.

According to Navi, this allowance will provide relief to affected customers who were in line for scheduled disbursals before the RBI’s ban.

Disbursal timeline set until December 31, 2024

The RBI’s approval permits Navi Finserv to carry out these pre-sanctioned home loan disbursals up until December 31, 2024.

This temporary provision is intended to address the needs of customers already committed to loans before the regulatory freeze.

Navi Finserv emphasized that this move by the RBI helps many homebuyers who were caught in the midst of the regulatory change, allowing them to receive their awaited funds within the specified timeline.

Ban on other NBFCs

The RBI’s actions have not been limited to Navi Finserv. Similar restrictions were placed on three other NBFCs: New Delhi-based DMI Finance Private Limited, Kolkata-based Arohan Financial Services Limited, and Chennai-based Asirvad Micro Finance Limited.

These measures reflect broader scrutiny within the sector, especially regarding the pricing practices of NBFCs. The RBI’s move signals increased oversight to ensure fair pricing and ethical lending practices across the industry.

Relief for affected homebuyers

The RBI’s recent allowance has been a relief for many homebuyers whose loans were left in limbo following the regulatory action.

For Navi Finserv customers, this means they can proceed with their property purchases as planned, now assured that the necessary funds will be released within the allowed period.