Ask 4 Compliance | Non Banking Financial Institutions (NBFC)
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NON BANKING FINANCIAL INSTITUTIONS (NBFC)

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What is NBFC Registration?

A Non-Banking Financial Company (NBFC) provides banking and other lending services without meeting the legal definition of a bank, which has been incorporated under Companies Act, 2013 or earlier Companies Act, 1956 and Every NBFC has to obtain Commencement of business certificate from RBI as defined under Section 45 I(a) of the RBI Act. NBFC shall not commence or carry on the business of Non- Banking Financial Institution without obtaining a Certificate of Registration issued by the Reserve Bank of India. NBFC registration is can be obtained in 90-120 days.

The principal business of NBFC is providing loans and advances, acquisition of shares, debentures and other stocks issued by Government or other local authorities, insurance business, business, leasing, hire-purchase, etc. Moreover, any other non-banking institution, incorporated as a company under the Companies Act and having principal business of receiving deposits under any scheme or arrangement in one lump sum or in installments, is also a non-banking financial company (NBFC).

In general, NBFC is filling up the gap of financial needs for the organized and unorganized section of the population. In the recent times, banks have targeted big commercial houses and individuals with good credit rating as their prime customers. This provided NBFCs with an opportunity to enlarge its presence in the financial market.

Process & Timeline

2-3 Months

Professional Fees

As per specific nature of work

(GST, Government Fees and other Out of Pocket Expenses Extra)

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What are the Types of NBFC Registration?

On the basis of nature of activity, they undertake, NBFC registration are categorized into the following:

  • Asset Finance Company.
  • Investment Company.
  • Loan Company.
  • Infrastructure Finance Company.
  • Core Investment Company.
  • Micro Finance Company.
  • Mortgage Guarantee Company.
  • Housing Finance Company.

On the basis of deposits they hold, NBFC registration are being assigned into following two categories:

  • Deposit accepting NBFCs.
  • Non-Deposit accepting NBFCs.

On the basis of size or minimum capital requirement, NBFC registration is further classified into following two categories:

  • Systematically Important NBFCs.
  • Non Deposit Holding NBFCs.

Procedure for NBFC Registration

Any entity desirous of commencing the business of and being registered as NBFCs shall apply to RBI for the license (CoR) and must also fulfill the following norms:

  • It should be a company incorporated under Companies Act, 2013.
  • It should be a company having minimum Net Owned Funds of Rs. 2 Crores.
  • Submission of hard copy of the application along with attached documents shall be submitted RBI Office.
  • The license will be granted only after vigilant inspection of the application and documents attached with it.

Our team of highly qualified professionals at Ask4compliance.com can help you to establish an NBFC to start your business as a corporate entity.

DOCUMENTS REQUIRED FOR REGISTRATION OF NON BANKING FINANCIAL INSTITUTION (NBFC)

  • Certified copy of Certificate of Incorporation issued by the Registrar of Companies.
  • Extract of the main object clause in the MOA clearly depicting the financial business.
  • The Audited balance sheet and Profit & Loss account along with directors & auditor’s report for the entire period of company’s existence, or for last three years, whichever is less.
  • Copy of the certificate of Director’s highest educational and professional qualification.
  • Copy of Director’s experience certificate in the Financial Services Sector (including Banking Sector).
  • Copy of Fixed Deposit receipt and Bankers report depicting details of deposits and loans balances as on the date of application and the conduct of the account.
  • Activities before getting registration from RBI
  • Any NBFC activity.
  • Accepting any public deposit.

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