A Govt Company (Sec 617 Co) with one of the Main Objects in its MoA is engaged in financing |infrastructure projects of Government only. It finances Urban local bodies, municipalities, etc., for infrastructure development in cities/ Towns out of money received by it from Government. This Company is 18 years old ( incorporated in 1993). It does not deal with general public directly or indirectly , but only with ULBs/ muncipalities.. The MoA merely says that it shall not carry on the busines of banking wihin the meaning of Banking Regulations Act, 1959. IS IT NECESSARY TO NOW get this Company registered with RB I as "Infrastructure Finance Company - a new category devised by RBI, if it wants to accept Deposits from Public? . Please clarify asap
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Nbfc
The Reserve Bank of India (RBI) Act, 1934 provides adequate protection to small depositors in financial institutions. The interest of Depositors in financial establishments can be broadly divided into two segments (a) companies registered as Non-Banking Financial Companies (NBFCs) which are under the regulatory purview of RBI, (b) Un-incorporated Bodies (UIBs) accepting public deposits unauthorisedly. The NBFCs are regulated under chapters III and V of the RBI Act, UIB’s have been precluded from accepting deposits from any person other than relatives specified in the RBI Act.
On pursuance by the RBI, 14 States and 1 Union Territory have enacted legislation on the lines of Tamil Nadu Protection of Interest of Depositors (in Financial Establishments) Act, 1997, which contains stiff penal provisions for promoters of financial establishments defaulting in repayment of deposits and interest. The close co-ordination through institutionalized framework of State Level Co-ordination Committee (SLCC) with the State Government and other Regulatory bodies have resulted in greater/ improved monitoring and restriction of unauthorized acceptance of deposits by NBFCs and UIBs.
May be my question was not clear. As such, it is not answered , i feel.. Sorry to say this.
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