New Delhi: Mahindra & Mahindra Financial Services Limited share price has crashed more than 14% on Friday following the Reserve Bank of India (RBI)’s ban for using third-party recovery agents. It is to be noted that a 27-year-old woman in Hazaribag District, Jharkhand was mowed down to death under a tractor by loan recovery agents when she had come to stop them for taking her father’s tractor.
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The Reserve Bank of India on Thursday announced that it has directed Mahindra & Mahindra Financial Services Ltd (MMFSL) to “immediately cease carrying out any recovery or repossession activity through outsourcing arrangements, till further orders.
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“However, the said NBFC may continue to carry out recovery or repossession activities, through its own employees, the RBI said.
M&M share on BSE Sensex was trading 11.42% down at Rs 198, which was around Rs 26 lower against the previous day of Rs 223.75.
Reacting on the RBI action, Mahindra & Mahindra Financial Services Limited said, “In the normal course of its business, the Company repossesses about 4000 to 5000 vehicles per month, using the third-party agencies and its own employees. The Company expects this number to go down temporarily by about 3000 to 4000 per month, as the Company implements the RBI order with immediate effect.”
Earlier, the chairman of Mahindra Group Anand Mahindra shared a condoling post regarding the incident. He wrote, “This is a terrible tragedy. I strongly support @anishshah21 ‘s statement. Our hearts go out to the family in this time of grief.”
(With ANI Inputs)