{"id":2281,"date":"2026-10-21T09:32:08","date_gmt":"2026-10-21T08:32:08","guid":{"rendered":"https:\/\/www.befisc.com\/fintechsherlock\/?p=2281"},"modified":"2026-10-20T09:32:22","modified_gmt":"2026-10-20T08:32:22","slug":"nbfc-registration","status":"publish","type":"post","link":"https:\/\/www.befisc.com\/fintechsherlock\/nbfc-registration\/","title":{"rendered":"\u00a0NBFC Registration in 2026: Process, Capital, and the Compliance Tech Stack"},"content":{"rendered":"\n

NBFC registration is the process of obtaining a Certificate of Registration (CoR) from the Reserve Bank of India under Section 45-IA of the RBI Act, 1934, before carrying on non-banking financial business. For a new lending NBFC (NBFC-ICC) in 2026, it means meeting a \u20b910 crore Net Owned Fund requirement and applying online through RBI\u2019s PRAVAAH portal.<\/p>\n\n\n\n

The licence is the start, not the finish. RBI consolidated its NBFC rulebook into entity-wise Directions on 28 November 2025, and a newly registered NBFC inherits KYC, fair practices, digital lending, credit reporting, AML<\/a>, and data protection obligations from day one.<\/p>\n\n\n\n

This guide covers the current capital requirements, the NBFC registration process step by step, what RBI looks at, and the systems a new NBFC needs to meet its obligations without building everything in-house.<\/p>\n\n\n\n

What NBFC Registration Means Under the RBI Act<\/h2>\n\n\n\n

Section 45-IA of the RBI Act, 1934 prohibits a non-banking financial company from commencing or carrying on the business of a non-banking financial institution without a CoR from RBI and the prescribed Net Owned Fund. What people call an \u201cNBFC license\u201d is this CoR.<\/p>\n\n\n\n

RBI regulates NBFCs under Scale Based Regulation, now set out in the NBFC Registration, Exemptions and SBR Directions, 2025. Non-deposit-taking NBFCs with assets below \u20b91,000 crore sit in the Base Layer; deposit-takers and larger NBFCs sit in the Middle Layer; the Upper Layer is identified by RBI through parametric scoring.<\/p>\n\n\n\n

The sector is large. According to FIU-IND<\/a>, citing RBI data, there were 7,936 Base Layer, 540 Middle Layer and 12 Upper Layer NBFCs registered as on 30 June 2026.<\/p>\n\n\n\n

A 2026 exemption worth knowing<\/h3>\n\n\n\n

On 29 April 2026, RBI issued Amendment Directions that exempt Type I NBFCs, those with no public funds and no customer interface, with assets below \u20b91,000 crore, from registration subject to conditions. The definition of public funds is wide, so this relief suits captive investment vehicles, not consumer or MSME lenders<\/a>.<\/p>\n\n\n\n

The Capital Requirement: Net Owned Fund<\/h2>\n\n\n\n

Net Owned Fund is, broadly, owned funds (paid-up equity and free reserves) less intangible assets and accumulated losses, further reduced by certain investments in and exposures to group entities beyond a threshold. RBI\u2019s 2025 Directions set minimum NOF by category:<\/p>\n\n\n\n

NBFC category<\/th>Minimum NOF<\/th>Notes<\/th><\/tr><\/thead>
NBFC-ICC (investment and credit company)<\/td>\u20b910 crore<\/td>Existing NBFCs on a glide path: \u20b95 crore by 31 Mar 2025, \u20b910 crore by 31 Mar 2027<\/td><\/tr>
NBFC-MFI<\/td>\u20b910 crore<\/td>Existing NBFCs: \u20b97 crore (\u20b95 crore in North East) by 31 Mar 2025, \u20b910 crore by 31 Mar 2027<\/td><\/tr>
NBFC-Factor<\/td>\u20b910 crore<\/td>Existing NBFCs: \u20b97 crore by 31 Mar 2025, \u20b910 crore by 31 Mar 2027<\/td><\/tr>
NBFC-P2P, NBFC-AA, NBFCs without public funds and customer interface<\/td>\u20b92 crore<\/td><\/td><\/tr>
NBFC-IFC, IDF-NBFC<\/td>\u20b9300 crore<\/td><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

The glide path first appeared in RBI\u2019s SBR framework of 22 October 2021 and carries into the 2025 Directions. An NBFC that fails to reach the prescribed NOF within the stated period is not eligible to hold its CoR (para 43).<\/p>\n\n\n\n

For founders, the practical point is that the \u20b910 crore must be genuinely owned, unencumbered, and evidenced. Funds routed back to promoters or parked in group entities reduce NOF.<\/p>\n\n\n\n

The NBFC Registration Process, Step by Step<\/h2>\n\n\n\n

RBI launched PRAVAAH, its online portal for regulatory applications, on 28 May 2024. Applications for new NBFC registration are submitted through it, along with the form and RBI\u2019s checklist of supporting documents.<\/p>\n\n\n\n

    \n
  1. Incorporate a company under the Companies Act, 2013 with financial business as a main object in its memorandum.<\/li>\n\n\n\n
  2. Infuse capital and arrange evidence of NOF, typically through auditor and banker certificates as required by RBI\u2019s checklist.<\/li>\n\n\n\n
  3. Prepare promoter, director, and shareholder information, including fit-and-proper declarations and credit information where required.<\/li>\n\n\n\n
  4. Draft a business plan and policies covering lending model, sources of funds, governance, and risk management.<\/li>\n\n\n\n
  5. Submit the application and documents on PRAVAAH, choosing the correct NBFC category.<\/li>\n\n\n\n
  6. Respond to RBI queries and clarifications through the portal.<\/li>\n\n\n\n
  7. On grant of the CoR, complete post-registration filings and registrations before commencing operations.<\/li>\n<\/ol>\n\n\n\n

    RBI does not publish a guaranteed processing time, and outcomes depend heavily on completeness and on the quality of promoter information. Incomplete applications are the most common avoidable delay.<\/p>\n\n\n\n

    Obligations That Start After the CoR<\/h2>\n\n\n\n

    A new NBFC must comply with several regimes from its first loan:<\/p>\n\n\n\n