NBFC Registration

    NBFC Registration

    An NBFC or a Non-Banking, Financial Company is that kind of financial institution which provides various financial and non-financial services to individuals, business enterprises, entrepreneurs, etc. They are different from the Cooperative and Commercial Banks; they do not need to hold a banking license, but must strictly follow the rules and regulations provided by RBI from time to time.NBFCs, most commonly, operate in the field of industrial and commercial loans and advances, deposit’s, leasing, hire-purchasing, investment funds, chit fund business, insurance business, instruments of the capitalist & money markets such as stocks, debentures, bonds, and many other similar activities. India’s financial sector has shown consistent growth for the past two decades NBFC License must be taken from RBI u/s 45-IA of the RBI Act of 1934. A financial institution wishing to be registered as an NBFC must be duly registered either as per the Companies Act of 2013, or the earlier Act of 1956.

    RBI strictly regulates and ensures that the NBFCs are complying with the provisions and regulations provided in Chapter III B of the RBI Act.

    The principal business activity of NBFCs is to raise capital from the public depositors & investors and lend these further to the borrowers.

    Types of NBFCs

    1. Liabilities:

    • The deposit accepting NBFCs and
    • Non-Deposit accepted NBFCs,

    2. Activities:

    • Factors
    • Mortgage Guarantee Companies
    • Investment Credit Company
    • Infrastructure Debt Fund
    • Micro Finance Institution
    • Non-Operative Financial Holding Company
    • Systemically Important Core Investment Company

    NBFC Registration Process

    Request a Call

    kindly fill your email and mobile number

      Documents Required for NBFC Registration in India

      Certificate of incorporation

      Take a Certified Copy of CoI, MoA (Memorandum of Association), and AoA (Articles of Association) from the Regional ROC (Registrar of Companies)

      Updated KYC

      Latest KYC details, income proof, credit report, and Net-worth Certificate of Directors and shareholders.

      Net Worth Certificate

      Collect updated net worth certificate of Directors, member/shareholders, and Company.

      Education Proof

      Education & qualification proof of the Directors.

      Company’s Details

      Company’s PAN & GST number. Documents in support of the address of the company.

      Bank Details

      Details of the bank account of the company. This account must have at least Rs.2 crores deposited as the minimum NOF requirement. And it must be well audited for the last 3-years.

      Banker’s Report

      A report to be obtained from the bank confirming the No Lien remark on the Initial Fixed Deposit of Rs.2 crores.

      Board Resolution

      The board’s resolution must include, “approving the formation of the NBFC”.

      Underwriting Model

      A detailed action plan, for the next 5-years, about the loan products, complying with the Fair Practices Code, credit, and risk assessment policy must be present.

      Organizational Structure

      Complete plan of the organization hierarchy and decision-making process. The proposed criteria on which a loan application will get approved or rejected.

      IT Policy

      The planned system and Information technology policy.

      What do you get

      DSC

      Digital signature for directors to digitally sign the documents

      MOA

      Defines the objectives of the NBFC

      AOA

      Defines the rules of the NBFC

      PAN

      PAN number of the company

      Rubber Stamps

      Two rubber stamps, one with the name of company and one with the name of director

      Incorporation Certificate

      Certificate of incorporation bearing company registration number and details

      License

      NBFC license number to operate the financial activities

      FAQs for NBFC Registration

      Yes, NBFC can accept deposits with deposit taking license.

      The minimum NOF for NBFC registration is INR 2 Crore. It shall be kept in the current account of the newly formed company in the form of Fixed Deposit.

      Lifetime unless otherwise canceled due to non-compliance with the law.

      For carrying loan or investment business in India, you must apply for NBFC License otherwise unlicensed lending or financing business is deemed to be illegal.

      RBI Does not regulate insurance, Chit fund, all such entities regulated by SEBI, Nidhi Company, etc.

      Public funds include ICD, Loan from Banks but Public deposits mainly includes souring of funds from individuals.