RBI Guv Meets Revanth, Seeks Act Against Ponzi SchemesPon
The BUDS Act, 2019, is a Central legislation aimed at curbing unregulated deposit schemes, but its effective implementation depends on states notifying their own rules and appointing competent authorities.
Hyderabad: Reserve Bank of India Governor Sanjay Malhotra on Thursday urged the Telangana government to notify the Banning of Unregulated Deposit Schemes (BUDS) Act in the State to strengthen action against ponzi schemes and illegal deposit‑taking activities. Malhotra made the request during a meeting with Chief Minister A. Revanth Reddy. The RBI Governor was in Hyderabad for the RBI Board meeting and called on the Chief Minister as part of his visit.
The BUDS Act, 2019, is a Central legislation aimed at curbing unregulated deposit schemes, but its effective implementation depends on states notifying their own rules and appointing competent authorities. While a few states, such as Kerala, have put the required framework in place, several others are yet to do so, resulting in uneven enforcement and loopholes that allow fraudulent schemes to operate across jurisdictions. Malhotra stressed that notifying the Act would help protect depositors and improve coordination between enforcement agencies.
The RBI Governor also briefed the Chief Minister on initiatives being taken by the central bank, including the Unified Lending Interface (ULI), designed to streamline and digitise the lending ecosystem.
He further informed the Chief Minister about the Government Private Deposit Claim campaign, an ongoing initiative to facilitate claims by depositors affected by illegal schemes and improve transparency in grievance redressal.
Revanth Reddy, in turn, apprised Malhotra of the reforms initiated by the Congress government across various sectors in Telangana. He outlined steps taken to stabilise and reform the energy sector and explained the State’s decision to create a third power distribution company to better serve consumer categories supported through government welfare measures. The Chief Minister said the reforms were aimed at improving service delivery, financial discipline and long‑term sustainability.
Malhotra appreciated the fiscal management and policy direction of the Telangana government and encouraged it to pursue further reforms and progressive measures to strengthen growth and financial stability. He said proactive State‑level initiatives complemented the broader objectives of the RBI in ensuring a resilient and inclusive financial system.
The meeting was attended by Chief Secretary K. Ramakrishna Rao, Principal Secretary to the Chief Minister V. Seshadri, Finance Secretary Sandeep Kumar Sultania and other senior officials.