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Banking > Policies>
policy environment> financial reforms


Non-Banking Financial Companies (NBFCs) Reforms


The process of registration of NBFCs is a continuous one. The Reserve Bank (Amendment) Act 1997 had allowed a period of three years to NBFCs which did not have the statutory minimum net owned funds (NoF) of Rs.25 lakh at the commencement of the Act to attain the minimum NoF and thus become eligible for registration. The three-year time period expired on January 9, 2000. Out of 26,938 NBFCs whose NoF was less than Rs.25 lakh as on January 9, 2000, as many as 8,070 NBFCs have reported to have stepped up their NoF to Rs.25 lakh or more, thus becoming eligible for registration. In addition, the Reserve Bank received 2,211 applications for extension of time. As per the provisions in the Act and NBFC Acceptance of Public Deposits (Reserve Bank) Directions, 1998, NBFCs with NoF less than Rs.25 lakh are not entitled to accept fresh public deposits. In the case of new NBFCs, which commence the business of a non-bank financial institution as on or after April 21, 1999, and which seek registration with the Reserve Bank, the requirement of minimum NoF was raised to Rs.2 crore. As on June 30, 2000, the Reserve Bank has granted certificates of registration to 679 companies permitting them to accept public deposits and to 8,451 companies without authorisation for acceptance of public deposits.

Also :

  1. Banking Sector Reforms

  2. Financial Institutions Reforms


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