The company informed customers that mass withdrawals will be limited in accordance with these rules.
It said there had been no past or present breaches and it intended to resume withdrawals next week, depending on the refunds received.
The new RBI guidelines have brought significant changes to the P2P lending landscape.
NBFC-P2P platforms are now prohibited from providing credit guarantees, assuming credit risks or offering liquidity options.
The tightening of norms by the RBI comes after it found that some platforms were violating prescribed fund transfer mechanisms and promoting P2P loans as an investment product with guaranteed profitability.
India P2P and other platforms face operational challenges under new rules.
Key issues include the T+1 settlement rule, which requires funds in escrow accounts to be transferred within a day, and the requirement to return EMIs to lenders without reinvestment options.
Industry sources warn that trustees may find it difficult to approve the large volume of daily transactions (ranging from ₹5 to ₹10 lakh) required to meet the RBI’s demands.
The P2P Lending Platforms Association plans to request a meeting with the RBI to seek clarification on these stricter regulations.
Industry players have expressed concern that the rules could severely impact business operations unless some relaxations are granted.
They consider the new rules to be a “hard blow” to the industry, and that credit risk distribution, reinvestment and settlement rules are at the heart of their concerns.
The RBI’s outlook
The RBI has revised and tightened master instructions for NBFC-P2P lending platforms after finding violations of its rules.
Some platforms were found to be acting as deposit takers and lenders, rather than functioning purely as intermediaries.
The revised regulations emphasize that P2P-NBFCs should not bear any credit risk and that all fund transfers between participants should be done through escrow accounts managed by a bank-promoted trustee.
Additionally, the RBI has capped a lender’s aggregate exposure to all borrowers on P2P platforms to ₹50 lakh.
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