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To safeguard the borrowers, the RBI has proposed tough outsourcing norms for NBFCs

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On Friday for the purpose of safeguarding the borrowers, the Reserve Bank of India (RBI) has proposed tough guidelines for outsourcing of work by NBFCs (non-banking financial companies) .

The RBI also has proposed that NBFCs should not outsource core management and decision making functions including internal audit and KYC to safeguard against risk.

“The NBFC and their agents should not resort to intimidation or harassment of any kind either verbal or physical against any person in their debt collection efforts, including acts intended to humiliate publicly or intrude the privacy of the debtors’ family members, referees and friends, making threatening and anonymous calls or making false and misleading representations,” the RBI draft said.

“Moreover, service providers should not be located outside India,” the Reserve Bank said in its draft.

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