AKP Banking & Finance Digest May 12, 2025
- AK & Partners
- May 12
- 5 min read
Updated: May 26
We are delighted to share this week's AKP Banking & Finance Weekly Digest. Please feel free to write to us with your feedback at info@akandpartners.in. We shall now be hosting our weekly updates at Spotify!
1. Regulatory Updates
1.1. India
Reserve Bank of India (RBI)
1.1.1. RBI’s Digital Lending Framework 2025: New Rules for NBFCs, LSPs & DLAs
The RBI has rolled out the Digital Lending Directions 2025, aimed at tightening compliance for banks, NBFCs, and Lending Service Providers (LSPs). Key highlights include:
- Mandatory borrower consent for data use
- Transparent disclosure norms
- 5% cap on Default Loss Guarantee (DLG) arrangements
- Mandatory reporting of all Digital Lending Apps (DLAs)
- Staggered implementation: starts June & November 2025.
1.1.2. RBI Removes FPI Investment Limits in Corporate Bonds
The RBI has eased FPI norms, scrapping short-term and concentration limits for Foreign Portfolio Investors in corporate debt under the General Route.
1.1.3. RBI Merger Approval: Sawantwadi Urban Co-op Bank + TJSB Sahakari Bank
Effective May 13, 2025, RBI has approved the merger of Sawantwadi Urban Co-op Bank into TJSB, enhancing banking access in Maharashtra.
1.1.4. RBI Cancels Licences of 5 NBFCs & 1 ARC
NBFCs like Sicom Investments, Easy Access Financial, and ARC India Resurgence have had their Certificates of Registration cancelled, mostly via voluntary exits.
Sr No | Name of the Company | CoR Issued on | Date of Cancellation of CoR |
Sicom Investments & Finance Limited | September 08, 2006 | April 04, 2025 | |
Pioneer Holdings Private Limited | January 06, 2003 | April 24, 2025 | |
3. | Easyaccess Financial Services Limited | December 22, 2008 | April 29, 2025 |
Cancellation of CoR due to NBFC ceasing to be a legal entity due to amalgamation/ merger/dissolution/ voluntary strike-off, etc.
Sr No. | Name of the Company | CoR Issued on | Date of Cancellation of CoR |
1. | Eastern Credit Capital Private Limited | December 20, 2012 | April 09, 2025 |
1.1.5. Monetary Penalties by RBI: Over INR 1.72 Cr Penalised This Week
State Bank of India (SBI) tops the list with a penalty of INR 1.72 crore for non-compliance on customer protection and loan monitoring rules.
Name of the Financial Institution | Penalty Imposed | Reasons |
INR 7,50,000/- (Indian Rupees Seven Lakh Fifty Thousand only) | Contravention and non-compliance with RBI directions on Loans and Advances to Directors and Related Parties. | |
INR 50,000/- (Indian Rupees Fifty Thousand only) | Contravention and non-compliance with RBI directions on Placement of Deposits with Other Banks by Primary Urban Co-operative Banks (“UCB”) | |
INR 3,00,000/- (Indian Rupees Three Lakh only) | Contravention and non-compliance with RBI directions on Maintenance of Deposit Accounts by Primary UCB | |
INR 2,00,000/- (Indian Rupees Two Lakh only) | Contravention and non-compliance with RBI directions on Loans and Advances to Directors and Related Parties. | |
INR 1,00,000/- (Indian Rupees One Lakh only) | Non-compliance with specific directions issued by the RBI under Section 35A read with Section 56 of the Banking Regulation Act, 1949. | |
INR 2,00,000/- (Indian Rupees Two Lakh only) | Contravention of the provisions of Section 26A read with Section 56 of the Banking Regulation Act, 1949. | |
INR 50,000/- (Indian Rupees Fifty Thousand only) | Contravention of provisions of Section 31 read with Section 56 of the Banking Regulation Act, 1949. | |
INR 1,50,000/- (Indian Rupees One Lakh Fifty Thousand only) | Non-compliance with certain directions issued by RBI on ‘Loans and advances to directors, their relatives, and firms/concerns in which they are interested’ and ‘Know Your Customer (KYC)’. | |
INR 50,000/- (Indian Rupees Fifty Thousand only) | Contravention of provisions of Section 31 read with Section 56 of the Banking Regulation Act, 1949. | |
INR 1,00,00,000/- (Indian Rupees One Crore only) | Non-compliance with Section 12B (5) of the Banking Regulation Act, 1949, regarding prior approval for shareholding limits under Section 12B (1) of the Act. | |
INR 1,72,80,000/- (Indian Rupees One Crore Seventy-Two Lakh Eighty Thousand only) | Non-compliance with directions issued by RBI on ‘Loans and Advances- Statutory and Other Restrictions’, ‘Customer Protection – Limiting Liability of Customers in Unauthorised Electronic Banking Transactions’, and ‘Opening of Current Accounts by Banks - Need for Discipline’ |
2. SEBI Regulatory Updates – IPO, REITs, and Market Access
2.1 SEBI Approves IPOs of Veritas Finance, Laxmi India Finance & Others
IPO approvals were granted to five companies, including an INR 2,800 Cr issue by Veritas Finance and Laxmi India Finance.
Company Name | Sector | IPO Status | Fresh Issue | Offer for Sale (OFS) | Remarks |
Veritas Finance | NBFC (Non-deposit taking) | Approved | INR 600 crore | INR 2,200 crore | Raising total INR 2,800 crore |
Laxmi India Finance | NBFC | Approved | 10.4 million shares | 5.64 million shares | Total issue size not yet valued in INR |
Jaajoo Rashmi Refractories | Refractories/Manufacturing | Approved | Not specified | Not specified | SEBI approval granted |
Ajay Poly | Manufacturing/Polymer Products | Approved | Not specified | Not specified | SEBI approval granted |
Regaal Resources | Mining/Resources | Approved | Not specified | Not specified | SEBI approval granted |
2.2 SEBI Cracks Down on Synoptics IPO Misuse
SEBI has barred Synoptics Technologies and its merchant banker for misusing INR 19 crore out of their IPO proceeds.
2.3 Financial Disclosure Rules Updated for REITs & InvITs
REITs and InvITs must now include audited financials, proforma disclosures for acquisitions/divestments, and standardised asset-level reporting.
2.4 KYC Agencies Must Publish Investor Charter
All KYC Registration Agencies (KRAs) are mandated to display a detailed Investor Charter on their websites.
3. NPCI Update – RuPay On-The-Go Launched in Agra Metro
NPCI and UPMRC have introduced RuPay contactless smartcards for Agra Metro commuters, backed by SBI’s GoSmart card, under the National Common Mobility Card initiative.
4. International Financial Services Centre (IFSC) – Tax and Access Reform
No TDS will be deducted on payments like interest, dividends, or fees to IFSC units across fintech, insurance, broking, and fund management sectors—valid for 10 years.
4.1. IFSC Gets TDS Exemption Under Income Tax Act
No TDS will be deducted on payments like interest, dividends, or fees to IFSC units across fintech, insurance, broking, and fund management sectors—valid for 10 years.
4.2 IFSCA Invites Public Comments on Global Access Framework
Proposed overhaul aims to align IFSC regulations with global capital markets, improving cross-border access.
5. Key Asian Markets – Indonesia & Philippines
Indonesia:
- Forex reserves remain strong at USD 152.5B
- Consumer Confidence Index rose to 121.7
Philippines:
- Removed from FATF grey list
- Inflation fell to 1.4% in April 2025
- Bank credit growth at 11.8%
6. Trends & Corporate Moves
6.1. Emerald Finance launches Salary Advance with Aggarwal Traders
This early-wage-access program enables salaried workers to access part of their monthly pay in advance.
6.2. Paytm Pauses Hiring, Bets on AI
Q4 saw a 35.6% drop in non-sales HR costs as Paytm doubles down on AI-led productivity and no backfills for attrition.
Disclaimer
The note is prepared for knowledge dissemination and does not constitute legal, financial or commercial advice. AK & Partners or its associates are not responsible for any action taken based on its contents.
For further queries or details, you may contact:
Mr Anuroop Omkar
Partner, AK & Partners
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