Page 61 - Banking Finance November 2024

RBI CIRCULAR

3. Submission of information: ARCs shall keep the infor- construction of Financial Assets and Enforcement of Se-
mation collected/ maintained by them, updated regu- curity Interest Act, 2002 (54 of 2002).
larly on a fortnightly3 basis or at such shorter intervals 7. Applicability
as mutually agreed upon between the ARC and the CIC These guidelines shall be applicable to all ARCs.
in terms of Regulation 10 (a) (i) and (ii) of the Credit
8. Commencement
Information Companies Regulations, 2006.
ARCs shall put in place system and processes to ensure
4. Rectification of rejected data: ARCs shall rectify the re- compliance with these guidelines latest by January 1,
jected data received from CICs and upload the same 2025.
with the CICs within seven days of receipt of such data.
5. Adoption of best practices: ARCs shall have a standard Implementation of Credit Information
operating procedure (SOP) in place for CIC related Reporting Mechanism subsequent to
matters which shall, inter alia, include the following
best practices: cancellation of licence or Certificate of
i) ARCs shall provide requisite customer information, Registration
including identifier information, to CICs.
October 10, 2024
ii) ARCs shall ensure that the records submitted to CICs
are updated regularly and that no instances of re- 1. The Credit Information Companies (Regulation) Act,
payment, including that of the last instalment, are 2005 (CICRA) stipulates that only Credit Institutions (CIs)
left unreported. can furnish credit information to Credit Information
Companies (CICs). Section 17(1) of CICRA mandates that
iii) Instances of non-updation of repayment informa-
CICs can collect credit information from its member CIs
tion may be avoided by centralising the issue of no-
or member CICs only. Therefore, only the entities that
objection certificates and providing information to
are covered under the ambit of section 2(f) of CICRA,
CICs.
2005 can submit credit information to CICs.
iv) ARCs shall appoint a nodal officer for dealing with
2. In view of the provisions of CICRA, entities whose licence
CICs.
or Certificate of Registration (CoR) has been cancelled
v) Customer grievance redressal shall be given top by the Reserve Bank of India, can no longer be deemed
priority especially in respect of complaints relating as CIs under CICRA and their credit information cannot
to updation/ alteration of credit information. be accepted by the CICs. In such cases, repayment his-
vi) Grievance redressal in respect of credit informa- tory of borrowers of these entities is not updated even
tion should be integrated with the existing systems, if these borrowers continue to repay/ clear their dues.
if any, for grievance redressal. 3. In order to redress the hardship faced by such borrowers,
vii) ARCs should abide by the period stipulated under in exercise of the powers conferred by sub-section (vii) of
CICRA and the Rules and Regulations framed there- section 2(f) and sub-section (1) of section 11 of CICRA, the
under in respect of updation, alteration of credit in- Reserve Bank of India directs CICs and CIs to implement a
formation, resolving disputes, etc. Procedure pre- credit information reporting mechanism subsequent to
scribed under Rules 20 and 21 of the Credit Infor- the cancellation of the licence/CoR of banks/ Non-Bank-
mation Companies Rules, 2006 in this regard should ing Finance Companies (NBFCs) as given in the Annex.
be adhered to. Deviations from stipulated time lim- 4. These CIs shall continue to be governed by the provi-
its should be monitored and commented upon in the sions of CICRA, Rules and Regulations framed thereun-
periodical reports/ reviews put up to the Board. der and directions issued by the Reserve Bank of India
6. Powers exercised from time to time.
This circular has been issued in exercise of the powers 5. These instructions shall be implemented within six (6)
conferred by Section 12 of the Securitisation and Re- months of the date of the circular.

54 | 2024 | NOVEMBER | BANKING FINANCE