The Fair Practices Code (FPC) is a set of guidelines issued by the Reserve Bank of India (RBI) for non-banking financial companies (NBFCs). The FPC is designed to protect the interests of borrowers and investors by ensuring that NBFCs act in a fair and transparent manner.
The FPC covers a wide range of topics, including:
- Disclosure of information to borrowers and investors
- Pricing of products and services
- Collection of dues
- Handling of complaints
- Dispute resolution
Applicable NBFCs
The FPC is applicable to all NBFCs, except for:
- NBFCs that are regulated by other regulators, such as the Securities and Exchange Board of India (SEBI) or the Insurance Regulatory and Development Authority (IRDA)
- NBFCs that are very small, with assets of less than ₹25 crores
MCQs on the Fair Practices Code for NBFCs in India
- Which of the following is not covered by the Fair Practices Code for NBFCs in India?
- Disclosure of information to borrowers and investors
- Pricing of products and services
- Collection of dues
- Dispute resolution
- Which of the following NBFCs is not subject to the Fair Practices Code?
- An NBFC that is regulated by SEBI
- An NBFC that is regulated by IRDA
- An NBFC that has assets of less than ₹25 crores
- All of the above
- What is the purpose of the Fair Practices Code?
- To protect the interests of borrowers and investors
- To ensure that NBFCs act in a fair and transparent manner
- To promote the growth of the NBFC sector
- All of the above