RBI To Initiate Resolution Process Against AVIOM India Under IBC

RBI To Initiate Resolution Process Against AVIOM India Under IBC

SUMMARY

The RBI has superseded the board of directors of AVIOM India Housing Finance, citing governance concerns and defaults in meeting various payment obligations

The central bank has appointed former Punjab National Bank CGM Ram Kumar as the administrator

Founded in 2016, AVIOM provides housing loans to low-income households across the country

The Reserve Bank of India (RBI) has superseded the board of directors of AVIOM India Housing Finance, citing governance concerns and defaults in meeting various payment obligations. 

“The Reserve Bank intends to shortly initiate the process of resolution of the company under the Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019, and would also apply to the NCLT, New Delhi, for appointing the Administrator as the Insolvency Resolution Professional,” the RBI said in a statement. 

The central bank has appointed former Punjab National Bank CGM Ram Kumar as the administrator under Section 45-IE(2) of the Reserve Bank of India Act, 1934.

Founded in 2016 by Kajal Ilmi, AVIOM provides housing loans to low-income households across the country. 

Notably, the company claims to combine lending with social impact and cater to the niche informal housing market. It offers housing loans to individuals for home improvements, renovation, and sanitation. 

As of June last year, the company claimed to have disbursed more than 80,000 loans in 13 Indian states. It has more than 350 branches across the country. 

In June last year, Inc42 reported that the company raised $5 Mn in debt funding from InsuResilience Investment Fund. Before that, it raised $10 Mn from BlueOrchard Microfinance Fund in the same year. 

Overall, AVIOM has raised more than $68 Mn in funding and counts the likes of Sabre Partners India, Nuveen and Gojo among its investors. 

The development comes at a time when the central bank has cracked down on a number of entities over the last year or so. 

In October last year, the RBI ordered Sachin Bansal’s Navi Finserv and three other non banking financial companies (NBFCs) to stop sanctioning and disbursing loans

However, later in December 2024, the central bank lifted the curbs on Navi.  

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.

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