Wow RBI is really in a mood. This is huge, considering Gold loans short term nature and 1/3rd of its book, this is going to really hurt IIFL.
https://rbi.org.in/scripts/BS_PressReleaseDisplay.aspx?prid=57444
Certain material supervisory concerns were observed in the gold loan portfolio of the company, including serious deviations in assaying and certifying purity and net weight of the gold at the time of sanction of loans and at the time of auction upon default; breaches in Loan-to-Value ratio; significant disbursal and collection of loan amount in cash far in excess of the statutory limit; non-adherence to the standard auction process; and lack of transparency in charges being levied to customer accounts, etc.
Literally they pointing out concerns in every step of gold loan lifecycle followed by IIFL. This gonna take a while to recover.
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