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DMI Finance, MUFG portfolio company, faces lower growth after RBI action

  • The RBI's action against high interest rates and non-compliance with regulations has caused stress among FinTech firms that rely on co-lending partnerships with large NBFCs.
  • The crackdown on unsecured lending indicates a tightening regulatory environment for sub-prime lending in the FinTech sector.
  • Increased scrutiny and potential further actions have led to a reassessment of risks, resulting in stricter underwriting processes, slower disbursals, and negatively affected growth in the unsecured lending market.
  • Despite an investment by MUFG Bank in DMI Finance, the company is likely to face lower growth as a result of the RBI's actions.

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