Manappuram and Muthoot in red

RBI, yesterday put out a cautionary advisory for the NBFCs extending gold loans against breaching the Rs 20,000 cap on cash loan disbursal. Bringing forth the Section 269 SS of Income Tax Act, 1961, RBI reminded the Gold loan companies that as per this, no individual can receive more than Rs 20,000 as loan amount in cash. This advisory comes after barring IIFL Finance in March from disbursing gold loans.

This advisory was issued after large gold-loan providing NBFCs had approached RBI, seeking clarity on cash disbursals.

Following this, the market leaders in this field, Muthoot Finance and Manappuram Finance are down in the red. Muthoot was down 9% at Rs.1510 and Manappuram by 8% at Rs.165.15.