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Informist, Wednesday, Jul. 1, 2026

MUMBAI – The Reserve Bank of India has exempted non-banking financial companies which do not avail of public funds and do not have a customer interface from the mandate to register with the central bank and create a reserve fund, the regulator said in a gazette notification Jun. 23. The exemption is effective from Wednesday. 

Shadow lenders with an asset size of less than INR 10 billion which operate without public funding and customer interfaces are exempt from the aforesaid norms, it said. To qualify for the exemption, the non-bank should have an annual board resolution stating it will not avail of public funding or have a customer interface in a financial year. Such a non-banking financial company should disclose itself as an 'Unregistered Type I NBFC' in its financial statements, the RBI said. 

As per the Reserve Bank of India Act, all non-banking financial institutions must obtain a certificate of registration from the central bank and must have a net owned fund of INR 2.50 million or any such specified figure which does not exceed INR 1 billion. These companies must also create a reserve fund and transfer 20% or more of their net profit every financial year to the fund before declaring any dividend, as per the Act.   End

Reported by Cassandra Carvalho

Edited by Akul Nishant Akhoury

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