...Gradual Business Stabilisation: IIFL Finance Limited's rating and Stable Outlook reflect Fitch Ratings' expectation that the franchise should gradually stabilise after a regulatory ban on new gold-backed lending was lifted in September 2024. Funding towards the gold-backed lending entity remains tentative, which could continue to restrain product growth, but funding for the housing loan and microfinance subsidiaries has been more resilient, which should support the credit profile of the consolidated group even if it does not quickly regain its past scale and scope. Lifted Sanctions, Improved Compliance: The removal of the regulatory embargo suggests that IIFL Finance has adequately addressed the regulator's concerns on its gold-backed lending practices. Risk and compliance standards are therefore likely to have improved. The company has also introduced new risk and compliance personnel, which may further strengthen controls and oversight. Nonetheless, corporate risk culture takes time to...
