RBI to cancel fraud-hit licence; issues show cause

Rbi has issued a show cause notice to another bank before cancelling the licence. The bank, which has become a victim of fraud, is called 'Sambandh Finserve Pvt Ltd.' After fraud, the net worth of this bank started decreasing even less than the limit fixed by RBI and in recent months the financial health of the bank has deteriorated from bad to worse. MoneyControl in a report quoted two persons who reported the case.

The same report said that rbi has issued a show cause notice to The Relationship Finserve asking why its licence should not be cancelled. The bank's net worth has shown a major decline. The report also claims that the process of cancellation of licence of The Relationship Finserve Bank has also been initiated. However, no news has come out on the rbi's case so far. The officers of The Relationship Finserve have also not made any statement.

In fact, Deepak Kindo, Managing Director and CEO, Relationship Finserve, is being considered as the main culprit in the fraud. Deepak Kido has been taken into custody by the Economic Offences Wing of Chennai Police. Finserve has been registered as NBFCs-MFI. Under rbi rules, non-banking financial institutions are required to maintain a capital in the form of Tier-I and Tier-II. It should be 15 per cent of their risk. March 2020 Relationship Finserve Pvt Ltd has reported about asset under management worth Rs 461 crore. SFPL has 5 because of this. 22 crores. It has a total of about 0 trapped loans. It is 67 per cent.

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