The Reserve Bank of
India (RBI) has, on 10 November 2014, issued the revised regulatory Framework
for Non-banking Finance Companies (NBFCs) with a view to streamlining the
regulations for the said sector.
The rationale behind the revised framework, as explained by the RBI, is to harmonise the regulations across deposit taking NBFCs and NBFCs with large asset sizes and to some extent bring them in line with the regulations applicable to banks. A lighter regulatory framework has been introduced for NBFCs that are not perceived to be posing significant risks to the financial system.
The intent of the new framework is to create a level playing field that does not unduly favour or disfavour any institution.
This alert summarises the salient features of the revised regulatory framework for NBFCs
The rationale behind the revised framework, as explained by the RBI, is to harmonise the regulations across deposit taking NBFCs and NBFCs with large asset sizes and to some extent bring them in line with the regulations applicable to banks. A lighter regulatory framework has been introduced for NBFCs that are not perceived to be posing significant risks to the financial system.
The intent of the new framework is to create a level playing field that does not unduly favour or disfavour any institution.
This alert summarises the salient features of the revised regulatory framework for NBFCs
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