pc
nid 92297
Apr 30, 2026
pthandapani@vixio.com
India
Reserve Bank of India
financial services
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1832 charsIndia's Reserve Bank Issues Amendment Directions on Non-Banking Financial Company Registration Requirements
On April 29, 2026, the Reserve Bank of India (RBI) issued the Reserve Bank of India (Non-Banking Financial Companies – Registration, Exemptions and Framework for Scale Based Regulation) Amendment Directions, 2026. This follows a consultation period that concluded on March 4, 2026, during which the RBI sought stakeholder feedback on draft amendment directions initially released on February 10, 2026.
The amendment directions introduce key changes to the regulatory framework for non-banking financial companies (NBFCs). The RBI has exempted NBFCs not availing public funds and not having customer interface—including Type I NBFCs—from registration requirements if their asset size is less than ₹1,000 crore, subject to specified conditions. The directions also establish procedures for deregistration or conversion of existing NBFCs not availing public funds and not having customer interface, including Type I NBFCs. The RBI examined all comments and feedback received during the consultation period and incorporated consequent modifications into the final amendment directions. A statement detailing the comments and feedback received has been provided in an annex to the press release.
These amendments form part of the RBI's broader review of its regulatory framework for NBFCs and reflect a scale-based regulatory approach. The changes are intended to streamline compliance requirements for smaller NBFCs operating without public funds and customer-facing operations, while maintaining appropriate regulatory oversight. The amendment directions are effective immediately upon issuance.
REFERENCE:
Reserve Bank of India Press Release, April 29, 2026: RBI issues Amendment Directions on review of regulatory framework including registration requirement for 'NBFCs not availing public funds and not having customer interface'
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1487 charsReserve Bank of India Seeks Issues Amendments to its Directions for Registration, Exemptions and Framework for Scale Based Regulation for Non-Banking Financial Companies
The Reserve Bank of India (RBI) has released a series of amendments to its directions for registration, exemption and framework for scaled based regulation of non-banking financial companies (NBFCs).
The directions prescribe:
NBFC typology and definitions including introducing specific definitions for a type I NBFC as one not availing public funds and not having any customer interface, a type II NBFC as any other registered NBFC, and an unregistered type I NBFC as one exempted from registration provisions under the Reserve Bank of India Act, 1934.
Registration exemptions and asset thresholds mandating that NBFCs not availing public funds and not having any customer interface with an asset size of less than INR 1,000 crore (US$120m) are exempted from specific registration provisions and may apply for deregistration, while those with an aggregate asset size of INR 1,000 crore (US$120m) or more must apply for registration as a type I NBFC through the PRAVAAH portal.
Overseas investment and regulatory compliance stipulating that an unregistered type I NBFC intending to undertake overseas investment in the financial services sector must register with the Reserve Bank of India, prohibiting them from undertaking overseas investment in the non-financial sector, and requiring type I NBFCs to disclose their status regarding public funds and customer interface in the notes to accounts of their financial statements.
The amendments will come into force from July 1, 2026.