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    Documents Required

    1. Certified Copy of Certificate of incorporation (CoI): Take a Certified Copy of CoI, MoA (Memorandum of Association), and AoA (Article of Association) from the Regional ROC (Registrar of Companies)
    2. Updated KYC: Latest KYC details, income proof, credit report, and Net-worth Certificate of Directors and shareholders.
    3. Net Worth Certificate: Collect updated net worth certificate of Directors, member/ shareholders, and Company.
    4. Education: Education & qualification proof of the Directors. Company’s Details: Company’s PAN & GST number. Documents in support of the address of the company.
    5. Bank Account:Details of the bank account of the company. This must have at least Rs. 2 crore deposited as the minimum NOF requirement. And well audited for the last 3-years.
    6. Banker’s Report: A report to be obtained from the bank confirming the No Lien remark on the Initial Fixed Deposit of Rs 2 crore.
    7. Board Resolution: The board’s resolution approving the formation of NBFC.
    8. Underwriting model: A detailed action plan, for the next 5-years, about the loan products, complying with the Fair Practices Code, credit, and risk assessment policy.
    9. Organizational Structure: Complete plan of the organization hierarchy and decision-making process. The proposed criteria on which a loan application will get approved or rejected.
    10. IT Policy: The planned system and Information technology policy.

    Procedure for NBFC

    Registration in India As defined under Section 45 I (a) of the RBI Act, 1934, a company can only register itself as NBFC if it is already incorporated and has a minimum net owned fund of Rs. 2 crores. The steps for NBFC registration are as follows:

    1. Step 1: Company Incorporation The applicant’s company must have the incorporation certificate under the Companies Act, 2013 or the Companies Act, 1956. The applicant needs to first obtain the company registration either as Private or Public Limited Company.
    2. Step 2: Apply for online registration on COSMOS The applicant needs to apply for online registration and submit a physical copy of the application along with the necessary documents to the Regional Office of the Reserve Bank of India. The application can be submitted on RBI’s official COSMOS website.
    3. Step 3: Click on CLICK option for company registration
      In the next step, you need to click on CLICK option on the login page of the COSMOS Application.
    4. Step 4: Download the excel form An Excel application will show up which you need to download and then upload after filling up all the required details. The company needs to indicate the correct name of the Regional Office in the field “C-8” of the “Annex-I identification Particulars” in the Excel application form.
    5. Step 5: The Company will be allocated a CARN number
      Once you have submitted the form, you will receive a Company Application Reference Number for the CoR (Certificate of Recognition) application filed online.
    6. Step 6: Submit the application along with the supporting documents to the regional office Once you have received CARN, you need to submit the physical application form along with the supporting documents to the regional office. The ROC will scrutinize the form and documents and will then send it to the head office.
    7. Step 7: Issuance of NBFC License After everything is found to be correct, the Head Office of RBI will, then, issue the NBFC license. The applicant can check the status of the application by keying in the acknowledgment number.

    RBI Conditions for Granting NBFC License

    For NBFC registration, the company shall apply in the format as specified by the RBI. Before registering the company as NBFC, RBI may inspect the financial & other books to satisfy the following conditions:

    1. That the NBFC can pay its present or future investors in full as and when their claims accrue.
    2. That its operations are not likely to be carried in any manner detrimental to the interest of its existing or future investors.
    3. The general character of the management and the Board shall not be prejudicial to the interest of the public or depositors.
    4. It has sufficient capital structure and earning potential.
    5. Public interest shall be served by licensing this company as an NBFC.
    6. The grant of CoR shall not be unfavorable to the operation of the financial sector. And is consistent with monetary stability, economic growth and considering such other relevant policies of RBI.

    NBFC compliances after COR

    1. Once you have completed the NBFC registration process, you need to follow certain guidelines by RBI
    2. Obtain membership from all four Credit rating agencies (CIBIL, Equifax, Experian and CRIF Highmark), if you are willing to have credit scoring from API, Please use Equifax
    3. Apply for E-KYC Registration & Regular reporting of the borrowers.
    4. FIU Registration.
    5. Income tax Returns.
    6. ROC Returns.
    7. Secretarial compliances.
    8. Statutory Audit.
    9. Tax Audit.
    10. File NBS-9 using Online Platform of RBI (COSMOS).


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