directions applicable to nbfc’s

7/21/2019 Directions Applicable to NBFCs

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Directions Applicable toNBFCs

The RBI has issued comprehensivedeposit acceptance and asset side

regulations as under for the NBFCs.while all the prudential norms areapplicable to public deposit

accepting/holding NBFCs onl! someof the regulations are applicable tonon"deposit accepting companies.


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A. Deposit Acceptance RelatedRegulations

i. Ceiling on #uantum of publicdeposits

ii. Investment in li#uid assets

iii. $eriods of deposits


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1. Ceiling on quantum of publicdeposits

%oan and investment companies " &.' times of N(F ifthe compan has N(F of Rs. )** la+h! minimuminvestment grade,-I credit rating! complies withall the prudential norms and has CR0R of &' percent.

0sset 1nance companies,0FCs 2 if compan hasN(F of Rs.)** la+h and complies with all theprudential norms.

3ith -I credit rating and &) percent CR0R" 4 times

of N(F.3ithout -I credit rating but CR0R &' percent orabove" &.' times of N(F! or Rs. &* crore! whichever isless.


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2. Inestment in liquidassets

NBFCs 2 &' percent of outstandingpublic deposit liabilities as at theclose of business on the last wor+ing

da of the second preceding #uarter!of which

Not less than &* percent in approved

securities! and

Not more than ' percent in termdeposits with scheduled commercial

ban+s.


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!. "eriod of deposits

No demand deposits.

NBFCs 2 &) to 5* months

RNBCs 2 &) to 64 months-NBCs ,chit funds 2 5 to 75 months


6/13

B. "rudential norms applicableto onl# t$ose NBFCs %$ic$

are accepting&$olding publicdeposits

i. Capital to ris+ assets ratio ,CR0Rii. Reporting sstem8 half earl return


7/13

1. Capital to ris' assetsratio (CRAR)

The NBFCs holding/accepting public depositsare re#uired to maintain CR0R as under8

9#uipment leasing companies/hire purchase

1nance companies ,with -I credit rating:&) percent

9#uipment leasing companies/hire purchase

1nance companies,without minimum

investment grade credit rating : &' percent%oan/investment companies : &' percent

RNBCs : &) percent


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2. Reporting *#stem+ ,alf#earl# return

;alf earl returns to be submitted

as at the end of march andseptember ever ear.

Time allowed for submission 2 threemonths from the due date.

The return to be certi1ed b thestatutor auditors of the compan.


9/13

. ru en a norms app ca e oall NBFCs irrespectie of %$et$ert$e# accept&$old public deposits

or not.

i. Income Recognition Norms

ii. N$0 Norms

iii. Restrictive Norms

iv. 0ccounting


10/13

1. Income RecognitionNorms

The recognition of income on the N$0

is allowed on cash basis onl.The unrealised income recognisedearlier is re#uired to be reversed


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2. N"A Norms

Recognition of income on an accrualbasis before the asset becomes N$0as under8"

%oans and advances 8 =pto si> monthsand 7* das past due period ,past dueperiod done awa with e?ect from

march 7&! )**7%ease and hire purchase 1nance 8 &)

months


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!. Restrictie Norms

%oan against own shares not allowed

-. Accounting *tandards

0ll the accounting standards and guidancenotes issued b institute of chartered

accountants of India ,IC0I are applicable toall NBFCs in so far as the are notinconsistent with the guidelines of the RBI.


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. Asset classi/cation

0ll forms of credit ,includingreceivables to be classi1ed into fourcategories8"

directions applicable to nbfc’s

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