The Reserve Bank of India has urged the state governements to nab the operations of fraudulous non banking firms which are collecting deposits from people.

"The state governments, under the prevailing laws, can take action against the unauthorised Non-Banking Financial Companies (NBFCs) collecting money from people," RBI assistant general manager (department of non-banking supervision) P.N. Murthi said.

RBI officials clarified that any other body excluding banks, NBFCs recognized by RBI, Insurance Regulatory Development Authority (IRDA) or Securities and Exchange Board of India (SEBI) are not allowed to do any kind of monetary business in the country.

Mizoram Chief Secretary Van Hela Pachuau said: "The northeastern state is a transit route for several illegal activities." "The problem has been persisting since the early 1980s. Even though we have been victimised by these fake companies all the time, we have not learnt lessons. Due to our carelessness and gullibility people have lost huge money," he said.

"When these companies make attractive offers we do not care to verify the authenticity and terms and conditions. We are easy prey to them," the chief secretary added.

Nationalised banks in Mizoram have suffered a lot due to the activities of NBFCs.