Reserve Bank of India Governor Sanjay Malhotra has urged the chiefs of non-banking financial companies to maintain sound underwriting standards and closely monitor asset quality.

As part of the Reserve Bank's ongoing engagement with regulated entities, the Governor held a meeting with the managing directors and CEOs of select NBFCs, including government NBFCs, housing finance companies (HFCs) and microfinance institutions.

Industry participation included the representatives of self-regulatory organisations, Sa-Dhan, the Micro Finance Institutions Network and the Finance Industry Development Council.

The participating entities together accounted for about 53% of total NBFC sector assets.

In his opening remarks, the Governor highlighted the important role of NBFCs and HFCs in facilitating credit flow. He underlined the need for sound underwriting standards and close monitoring of asset quality, the RBI said in a release.

Malhotra further emphasised the criticality of customer centricity, ethical conduct and responsible lending, along with prompt grievance redressal, to preserve confidence in the sector and support its orderly and sustainable development.

The Reserve Bank had last held a similar meeting with NBFCs on 13 February 2025.

During the discussion, participants shared feedback on policy issues and operational matters relating to the NBFC sector, the RBI said.

The meeting was also attended by deputy governors T Rabi Sankar, Swaminathan J, Poonam Gupta, and S C Murmu, and the MD and CEO of the National Housing Bank, as well as other senior officers of the Reserve Bank.