Muthoot, Manappuram Finance drop up to 7% as RBI restricts cash loan amount
NEW DELHI: Shares of gold loan companies dropped up to 4 per cent in Friday’s trade after the RBI said NBFCs cannot lend more than Rs 20,000 in cash against gold. Instead, they have to issue cheque on a loan amount above that.
Earlier, NBFCs were allowed to disburse high value loans of Rs 1 lakh and above against gold only through cheque.
RBI reduced the amount to Rs 20,000 from the earlier Rs 1 lakh in line with the provisions of the Income Tax Act.
"…the relevant threshold under the Income Tax Act, 1961 is Rupees Twenty thousand," the central bank said, while amending the provisions for disbursal of loan amount in cash by NBFCs.
This assumes significance in the backdrop of government’s focus on less cash economy and promoting digital payments, PTI reported.
Shares of Muthoot Finance fell 7.06 per cent to hit a low of Rs 326.65 on BSE. Manapurram Finance dropped 5.69 per cent to hit a low of Rs 89.4 on BSE.
Earlier, NBFCs were allowed to disburse high value loans of Rs 1 lakh and above against gold only through cheque.
RBI reduced the amount to Rs 20,000 from the earlier Rs 1 lakh in line with the provisions of the Income Tax Act.
"…the relevant threshold under the Income Tax Act, 1961 is Rupees Twenty thousand," the central bank said, while amending the provisions for disbursal of loan amount in cash by NBFCs.
This assumes significance in the backdrop of government’s focus on less cash economy and promoting digital payments, PTI reported.
Shares of Muthoot Finance fell 7.06 per cent to hit a low of Rs 326.65 on BSE. Manapurram Finance dropped 5.69 per cent to hit a low of Rs 89.4 on BSE.
