RBI issues Revised Regulatory Framework for NBFCs; Revokes Suspension on issuing CoR

The Reserve Bank of India (RBI) has issued the revised Regulatory Framework for Non-banking Finance Companies (NBFCs), with a view to streamlining the regulations for the sector. It also revoked, with immediate effect, its temporary suspension on issuance of Certificate of Registration (CoR) to companies proposing to conduct business of non-banking financial institution (NBFI). (The Reserve Bank had temporarily suspended issuance of Certificate of Registration on April 1, 2014 pending revision in the framework for NBFCs.)

Explaining the rationale behind the revised framework, the Reserve Bank stated, "a lighter regulatory framework has been placed on NBFCs other than for those with large asset sizes and deposit accepting. For NBFCs with large asset sizes, and for all deposit accepting NBFCs, regulations have been harmonised across NBFCs, and to some extent, with banks. The intent is to create a level playing field that does not unduly favour or disfavour any institution." It further stated that in limited areas where harmonisation has resulted in strengthening the regulations, generally adequate time has been given to manage the transition. The regulator will then focus on the most important and systemic risks.

 

The revised regulatory framework for NBFC is:

 

Revised regulatory framework for NBFC

Powered by Capital Market - Live News