NBFC Registration

A company desirous of commencing business of a non-banking financial institution as defined under Section 45 I(a) of the RBI Act, 1934 should comply with the following:

• it should be a company registered under the Companies Act, 1956/2013
• It should have a minimum net owned fund of Rs 10 Crore. (For NBFC-ICC, NBFC-MFI and NBFC-Factor)

In terms of Section 45-IA of the RBI Act, 1934, no NBFC can commence or carry-on business of a non-banking financial institution without a) obtaining a certificate of registration from the Bank.

Exemption

Following categories of NBFCs which are regulated by other regulators are exempted from the requirement of registration with RBI:

• Housing Finance Companies - regulated by the National Housing Bank.
• Merchant Banking Company/Venture Capital Fund Companies/ Stock Broking/ Collective Investment Schemes (CIS) – SEBI
• Nidhi companies/ Mutual Benefit Companies – MCA
• Chit Fund Companies – State Government (Chit Funds Act, 1982)
• Insurance Companies - IRDA

Application Process

1. First step is to get a Company incorporated under the Companies Act.
2. The applicant company is then required to apply online and submit a physical copy of the application along with the necessary documents to the Regional Office of the Reserve Bank of India.
3. On RBI's website, the applicant shall register itself under New User Category.
4. Once registration is done, login using login credentials.
5. A window showing the Excel application form available for download would be displayed.
6. The company can then download suitable application form (i.e. NBFC or SC/RC) from the above website, key in the data and upload the application form.
7. The company may note to indicate the correct name of the Regional Office in the field "C-8" of the "Annex-I dentification Particulars" in the Excel application form.
8. The company would then get a Company Application Reference Number for the CoR application filed on-line.
9. Thereafter, the company hasto submit the hard copy of the application form (indicating the online Company Application Reference Number, along with the supporting documents, to the concerned Regional Office.
10. The company can then check the status of the application from the above-mentioned secure address, by keying in the acknowledgement number.

Documents required for NBFC

1. Certified copies of Incorporation Certificate.
2. Certifies copies of Commencement Certificate (In case of Public Ltd).
3. Company's Pan Card.
4. If Company has changed its name, then all such name changes certificates.
5. If Company has registered with any other financial regulator other than ROC, then such registration certificate.
6. Company's MOA and AOA.
7. Certified copies of extract of only the main object clause in the MOA relating to the financial business.
8. KYCof each director.
9. Credit Bureau Report pertaining to the directors of the company.
10. Copy of the certificate of highest educational and professional qualification in respect of all the directors.
11. Copy of experience certificate, if any, in the Financial Services Sector (including Banking Sector) in respect of all the directors.
12. Projected business plan for 3 years.
13. Board Resolutions stating that:

• the company is not carrying on any NBFC activity/stopped NBFC activity and will not carry on/commence the same before getting registration from RBI.
• the company has not accepted any public deposit, in the past (specify period)/does not hold any public deposit as on the date and will not accept the same in future without the prior approval of Reserve Bank of India.
• the UIBs in the group where the director holds substantial interest or otherwise has not accepted any public deposit in the past /does not hold any public deposit as on the date and will not accept the same in future.
• the company has formulated "Fair Practices Code" as per RBI Guidelines.

14. Copy of Fixed Deposit receipt &bankers' certificate of no lien indicating balances in support of NOF.

Please note that additional documents may be required depending upon type of NBFC.

The process of getting NBFC License and the documentation involved is a quite complex. We Integrius Advisors are a boutique firm offering integrated solutions in regulatory compliance, governance, and legal functions. We are one-step service provider to obtain any type of NBFC Registration in India.

Apart from NBFC Registration we also provide other integrated services including but not limited to:

• Compliance Management
• Drafting Regulatory Policies
• Framing Standard Operating Procedure (SOPs)
• Preparing and Reviewing Loan Documents
• Contract Drafting and Life Cycle Management
• Litigation Management

The author can also be reached at neha@integriusadvisors.com