Recently reserve Bank of India RBI has made it mandatory for banks to compulsorily link repo-rate with interest-rate, so that loan-takers rather than loan-providing banks may be beneficiary of repo-rate cut announced by RBI. But there is no clarification in regard to Non-Banking-Financial-Companies NBFCs which continue to charge earlier increased interest-rates despite repo-rate cut announced by RBI.
Earlier also RBI in its recent circular announcing total waiver of foreclosure-charges on pre-payment of loans in respect of banks deliberately and traditionally avoided applying the much-awaited decision in respect of NBFCs.
Vigilance-enquiry is needed at concerned RBI division regulating NBFCs why RBI patronises NBFCs in their wrong-doings and not applying public-interest regulatory measures for NBFCs simultaneously when such measures are taken for banks. RBI should immediately issue necessary orders for complete waiver of foreclosure-charges for pre-payment of loans to NBFCs, and compulsory linking of repo-rate with interest-rate by NBFCs also.
Since NBFCs act like banking companies for giving loans, provision of Tax-Deducted-At-Source TDS on interest-portion of EMIs must not be applicable for NBFCs, where most loan-takers do not claim TDS from NBFCs which becomes profit for NBFCs. Till such a provision is made, NBFCs should be directed to deposit unclaimed TDS in government-account.