NBFCs Must Embrace Ethical Practices for Sustainable Growth: RBI's Swaminathan J

RBI Deputy Governor Swaminathan J emphasized the importance of ethical practices among NBFCs, urging them to adopt transparent pricing and respectful customer treatment. Highlighting governance, he stressed the critical role of the Audit Committee in ensuring financial integrity, advocating for a fair, inclusive financial system that complements the banking sector.

At a recent conference, RBI Deputy Governor Swaminathan J urged Non-Banking Financial Companies (NBFCs) to prioritize ethical practices, ensuring transparent pricing free from hidden costs. He called for customer treatment grounded in dignity and empathy, especially during loan recovery processes.

Swaminathan criticized NBFCs for pursuing models focused on quick growth at the expense of transparency and fairness. He warned against financial exploitation masked as inclusion and insisted on commitments to fairness from top executives and boards.

Emphasizing financial integrity, Swaminathan highlighted the role of the Audit Committee of the Board (ACB) in governance. He noted its importance in institutional oversight and proactive problem solving to support a dynamic and inclusive financial ecosystem.

(With inputs from agencies.)