A company must obtain a Certificate of Registration from the Reserve Bank of India under Section 45-IA of the RBI Act, 1934 before carrying on NBFC business. Applicants need to be a registered company, meet the net owned fund requirement for their category (Rs 10 crore for most categories under scale-based regulation), have fit and proper directors and a credible business plan, and apply online through RBI's portal.
Who needs NBFC registration
A company whose financial assets and financial income each exceed 50% of total assets and total income (the principal business test) and which lends, invests or accepts deposits needs RBI registration. Carrying on such business without a certificate is prohibited.
Common NBFC categories
- Investment and Credit Company (NBFC-ICC)
- NBFC-Microfinance Institution
- NBFC-Factor
- Core Investment Company
- Account Aggregator and Peer-to-Peer lending platforms
Under Scale-Based Regulation, NBFCs are placed in Base, Middle, Upper or Top layers with increasing regulation.
Application process
- Incorporate a company with financial activities in its objects.
- Infuse capital to meet the net owned fund requirement and keep it in a fixed deposit.
- Prepare the business plan, credit policy and director profiles.
- Apply online through RBI's portal and submit documents to the regional office.
- Respond to RBI queries; certificate issued on approval.
Short on time? Leegal can handle NBFC Registration for you, end to end.
Get expert help →Timeline and compliance
RBI's review commonly takes several months. After registration, NBFCs file periodic returns, follow prudential norms, fair practices code and KYC directions, and obtain approval for changes in control or management.
Frequently asked questions
Can an LLP become an NBFC?
No. RBI registers companies incorporated under the Companies Act as NBFCs. An LLP or partnership cannot obtain an NBFC certificate of registration.
How long does NBFC registration take?
It usually takes several months, depending on the completeness of the application, the business plan and RBI's queries. Well-prepared applications move faster.
Is buying an existing NBFC faster than registering a new one?
Acquiring an existing NBFC can be faster but requires RBI's prior approval for change in control or management, plus thorough due diligence on the target's compliance history.
Do NBFCs need to be audited annually?
Yes. NBFCs must have their accounts audited, and the statutory auditor issues a separate report to the Board as required by RBI directions.
Let Leegal handle your NBFC Registration
Documentation, filing and follow-up by a dedicated expert, so you can focus on running your business.
- Dedicated point of contact
- Transparent pricing
- Pan-India service