The Reserve Bank of India cancelled the Certificates of Registration of 135 non-banking financial companies, including Rightex Trading Private Limited and Khera Motor Finance Private Limited. Invoking Section 45-IA (6) of the RBI Act, the regulator banned these firms from credit operations due to persistent regulatory non-compliance.
MUMBAI — In a major regulatory enforcement action targeting the shadow banking industry, the Reserve Bank of India (RBI) has officially cancelled the Certificates of Registration (CoR) of 135 Non-Banking Financial Companies (NBFCs) nationwide. Among the specific entities targeted in the sweeping enforcement mandate are Rightex Trading Private Limited and Khera Motor Finance Private Limited.
The comprehensive administrative action, executed under strict federal financial mandates, permanently blocks these corporations from operating as credit or investment entities. The regulatory crackdown forms part of a wider central bank initiative to weed out non-operational, non-compliant, or high-risk financial institutions from the domestic banking system.
Central Bank Invokes Statutory Powers Over Credit Violations
The apex banking regulator executed the cancellation orders by exercising its statutory authority under Section 45-IA (6) of the Reserve Bank of India Act, 1934. According to official notification logs published by the Reserve Bank of India, the affected businesses failed to comply with strict operational protocols, which include maintaining mandatory asset-to-liability ratios, preserving Net Owned Fund (NOF) minimum benchmarks, or filing mandatory periodic supervisory returns.
Following the formal withdrawal of their operational certificates, both Rightex Trading Private Limited and Khera Motor Finance Private Limited are strictly prohibited from transacting any business as non-banking financial institutions under clause (a) of Section 45-I of the RBI Act. Promoters and executive directors of these companies face immediate restrictions on offering public loans, collecting retail investments, or marketing asset-backed financing products.
Regional Concentration of Financial Crackdown Revealed
While Rightex Trading and Khera Motor Finance represent individual regional entities, the broader administrative sweep highlights deep structural non-compliance across multiple industrial zones.
An internal analysis of the central bank's master revocation register shows that a substantial majority of the 135 shut-down corporations maintained corporate headquarters or regional addresses in Kolkata and neighboring commercial districts of West Bengal. However, the regulatory enforcement orders also heavily penalized delinquent corporate structures operating across Maharashtra, Delhi, Telangana, Tamil Nadu, and Madhya Pradesh.
Alongside the forced liquidations, the central bank confirmed that an additional 13 corporate entities voluntarily surrendered their banking certificates during the same review period. These voluntary exits were caused by corporate amalgamations, internal structural dissolutions, or decisions by management teams to exit the financial services space entirely.
Immediate Consequences for Corporate Investors and Retail Borrowers
The complete cancellation of an institutional lending license changes the legal dynamics for all active financial counter-parties:
Impact on Existing Borrowers: Retail or commercial borrowers who have active loans with Rightex Trading or Khera Motor Finance are not absolved of their obligations. All signed loan agreements remain fully binding. Borrowers must continue to repay outstanding principal and interest balances according to their original timelines to prevent negative credit reporting.
Impact on Corporate Promoters: Shareholders and executive promoters are restricted from re-applying for any alternative financial services licenses until they undergo strict fit-and-proper regulatory audits conducted by central banking supervisors.
Winding-Down Obligations: The closed financial firms are legally ordered to transition into simple debt-collection bodies, focusing solely on resolving current books without creating new credit lines.
Official Sources Section
The financial regulatory actions are guided by official statutory announcements from central monetary bodies:
The Reserve Bank of India (RBI) Department of Supervision: Administrative press releases and statutory orders published under the Reserve Bank of India Act, 1934.
Ministry of Finance (Regulatory Division): Policy updates detailing compliance guidelines for shadow banking systems and non-banking corporate structures.
Quote Section
"According to officials from the Reserve Bank of India, companies whose certificates of registration have been formally cancelled shall not transact the business of a non-banking financial institution under any circumstances, and any violation of this directive will invite severe criminal prosecution."
Why It Matters
For everyday consumers, micro-investors, and commercial borrowers, this continuous monitoring limits the spread of unvetted, shadow-lending practices. By removing dormant or non-compliant corporate structures like Rightex Trading and Khera Motor Finance from the financial ecosystem, the regulator prevents predatory loan-servicing methods, eliminates systemic financial instability, and ensures that public capital remains concentrated within fully transparent, strictly audited banking networks.
Key Facts at a Glance
Enforcement Scope: The RBI has cancelled the operating licenses of 135 non-banking finance firms across India.
Primary Targets: Rightex Trading Private Limited and Khera Motor Finance Private Limited are stripped of their legal financial status.
Legal Grounding: All actions were formally executed under Section 45-IA (6) of the Reserve Bank of India Act, 1934.
Regional Hub: The largest concentration of non-compliant finance entities was recorded in West Bengal.
Borrower Status: Active borrowers remain legally required to repay all outstanding loans to the winding-down entities.
Frequently Asked Questions (FAQ)
1. Can Rightex Trading or Khera Motor Finance continue to issue new loans?
No. Following the cancellation of their Certificates of Registration, these companies are completely banned from conducting any financial services or issuing new lines of credit.
2. I have an active loan with Khera Motor Finance. Do I still need to pay it back?
Yes. The cancellation of an NBFC licence does not erase a borrower's legal debt. You must continue making your scheduled payments to avoid damaging your credit history.
3. What options do these companies have after losing their RBI licences?
Under standard regulatory provisions, the affected firms can appeal the cancellation order before the designated appellate authority within 30 days of receiving the official directive.
4. Why does the RBI cancel NBFC registrations?
The central bank cancels registrations when entities fail to meet minimum net owned funds, stop active operations, repeatedly fail to file mandatory financial returns, or breach central banking rules.
Source: Official Regulatory and Supervisory Notifications via the Reserve Bank of India.
