What changed
RBI issued a fresh reminder on July 26, 2013, reinforcing its 2007 circular that NBFCs must use only TRAI-registered telemarketers. The regulator noted that many institutions and their franchisees were still using unregistered telemarketers, leading to customer complaints about unsolicited calls to numbers on the National Customer Preference Register.
What it means for you
NBFCs face heightened compliance risk if they or their agents use unregistered telemarketers, as this violates TRAI regulations and invites regulatory action. Lenders must audit their direct selling agents, call centers, and franchisees to ensure all telemarketing vendors are TRAI-registered, or face potential penalties and reputational damage from customer grievances.
What you must do
- Verify that all telemarketing vendors, including DSAs and call centers, are registered with TRAI as per current guidelines.
- Update vendor contracts to mandate TRAI registration and include clauses for compliance with the National Do Not Call Registry.
- Conduct periodic audits of telemarketing activities to ensure no unregistered entities are making calls on your behalf.
- Train franchisees and agents on the requirement to use only registered telemarketers for promotional activities.
Who it affects
All Non-Banking Financial Companies (NBFCs), Residuary Non-Banking Companies (RNBCs), Direct Selling Agents (DSAs) and call centers working for NBFCs, Franchisees of NBFCs involved in telemarketing
What is the key requirement from this RBI circular?
NBFCs and RNBCs must engage only telemarketers who are registered with TRAI under the Telecom Commercial Communications Customer Preference Regulations, 2010, for all promotional or telemarketing activities.
Why did RBI issue this reminder in 2013?
RBI observed that many financial institutions and their franchisees were using unregistered telemarketers, who used normal telephone lines to call customers on the National Customer Preference Register, causing widespread customer grievances.
What happens if an NBFC uses an unregistered telemarketer?
It violates TRAI regulations and RBI guidelines, potentially leading to regulatory action, penalties, and increased customer complaints. NBFCs must ensure strict compliance to avoid these risks.