NBFCs seek easing of rules on NACH mandate cancellation

NBFC industry body says this facility should work on "best effort" basis and not be made mandatory as most customers are not tech-savvy and are not comfortable with electronic platforms

Non-banking finance companies (NBFCs) especially those with assets below Rs 500 crore, are seeking easing of rules to allow mandate cancellation facility (for NACH) through simpler means such as Whatsapp/SMS in a secure manner.

Finance Industry Development Council, the industry lobby group of Assets and Loan Financing NBFCs, said this facility should work on a “best effort” basis and not be made mandatory as most customers are not tech-savvy and are not comfortable transacting on electronic platforms.

Many of these NBFCs are very small and operate in a limited geography and do not have a well-developed website. Also, most of their customers