PREAMBLE & REGULATORY FRAMEWORK
Ricavi Finance Private Limited (“the Company”) recognises that outsourcing of certain financial and operational activities may be required for efficiency; however, the Company shall retain ultimate control and responsibility for all outsourced activities. Outsourcing shall not dilute the Company’s obligations to customers or regulatory responsibilities. This Outsourcing of Financial Services Policy (“Policy”) is framed to ensure that outsourcing arrangements are undertaken in a controlled and compliant manner.
This Policy is framed in accordance with:
• Reserve Bank of India Act, 1934;
• Master Direction – RBI (Non-Banking Financial Company – Scale Based Regulation) Directions, 2023;
• RBI guidelines on Outsourcing of Financial Services by NBFCs;
The Company is a Non-deposit-taking NBFC classified as NBFC – Investment and Credit Company (NBFC-ICC), Base Layer (NBFC-BL).
OBJECTIVES
The objectives of this Policy are to:
• Establish a framework for outsourcing activities;
• Ensure effective risk management of outsourced services;
• Protect customer interests and data confidentiality;
• Ensure compliance with RBI and statutory requirements;
• Maintain oversight and control over outsourced activities.
SCOPE & APPLICABILITY
This Policy applies to:
• All outsourcing arrangements entered into by the Company;
• All third-party service providers engaged for outsourced activities;
• All Directors, officers and employees involved in outsourcing decisions
DEFINITION OF OUTSOURCING
Outsourcing refers to use of a third party, either on a continuing or one-time basis, to perform activities that would normally be undertaken by the Company.
ACTIVITIES THAT MAY BE OUTSOURCED
The Company may outsource the following activities, subject to Board approval:
• IT systems, software support and maintenance;
• Data processing and record management;
• Customer communication support;
• Collection and recovery support (where applicable);
• Any other support services as approved by the Board.
ACTIVITIES THAT SHALL NOT BE OUTSOURCED (Except Permitted Support Functions)
The Company shall not outsource core management and decision-making functions, including:
• Strategic planning and policy formulation;
• Credit sanctioning and approval;
• Risk management decisions;
• Internal audit and compliance oversight;
• Customer grievance redressal responsibility.
DUE DILIGENCE & VENDOR SELECTION
• The Company shall conduct appropriate due diligence before appointing a service provider;
•Due diligence shall include assessment of financial soundness, reputation, experience and data security practices;
• Background checks shall be carried out, wherever applicable.
CONFLICT OF INTEREST
• The Company shall ensure that the service provider does not have any conflict of interest that may adversely affect the Company or its customers
OUTSOURCING AGREEMENT
All outsourcing arrangements shall be governed by written agreements that include:
• Scope of services;
• Confidentiality and data protection obligations;
• Right of access for the Company, RBI and auditors;
• Unrestricted right of access and inspection by the Reserve Bank of India or persons authorised by the RBI
• Service level standards;
• Termination and exit clauses;
• Liability and indemnity provisions.
CONFIDENTIALITY & DATA PROTECTION
• Customer information shall be treated as confidential;
• Service providers shall not disclose customer data without authorisation;
• Adequate safeguards shall be implemented to protect data security;
• Data ownership shall remain with the Company at all times.
MONITORING & OVERSIGHT
• The Company shall monitor performance of service providers on an ongoing basis;
• Periodic reviews shall be conducted;
• Any deficiencies or breaches shall be promptly addressed.
BUSINESS CONTINUITY & CONTINGENCY PLANS
• The Company shall ensure that service providers have adequate business continuity arrangements;
• Exit strategies shall be defined to ensure continuity of service in case of termination or failure of the service provider.
CUSTOMER PROTECTION & GRIEVANCE REDRESSAL
• Outsourcing arrangements shall not diminish the Company’s responsibility towards customers. The Company shall ensure that service providers adhere to the Company’s Fair Practices Code, customer protection principles, and applicable RBI guidelines. All customer grievances shall be handled under the Company’s Grievance Redressal Mechanism.
REPORTING TO THE BOARD
• Details of material outsourcing arrangements shall be placed before the Board;
• Significant issues relating to outsourced activities shall be reported promptly.REVIEW & AMENDMENT
This Policy shall be reviewed at least annually or earlier if required due to regulatory or business changes. Any amendment shall require approval of the Board of Directors..
REGULATORY OVERRIDE
In the event of any inconsistency between this Policy and RBI directions or applicable laws, statutory provisions shall prevail, and this Policy shall stand amended to that extent.
FOR AND ON BEHALF OF RICAVI FINANCE PRIVATE LIMITED
Name: Chirag Desai
Designation: Whole-Time Director
DIN: 08178002