NBFC License
                     NBFC  
LICENSE
This Photo by Unknown author is licensed under CC BY-SA.
NBFC: Non Banking 
Financial Corporations
 Non – Banking Financial Corporation is a 
company incorporated under the Companies 
Act 2013 or 1956 which is engaged in the 
business of Loans and Advances, Acquisition 
of stocks, equities, debt etc issued by the 
government or any local authority.
 The main objective of this type of a 
company is to accept deposits under any 
scheme or manner
This Photo by Unknown author is licensed under CC BY-NC-ND. This Photo by Unknown author is licensed under CC BY-SA.
According to section 45-I (c) of the 
RBI Act, a Non – Banking Company 
carrying on the business of a 
financial institution will be an NBFC. 
It is governed by the Ministry of 
Corporate Affairs as well as the 
Reserve Bank of India
NBFC's WHO DOES NOT REQUIRE 
REGISTRATION WITH RBI
Core Investment 
Companies – Companies which 
(assets are less Merchant Banking are engaged in the Housing Finance 
than 100 crore or Companies business of stock- Companies
public funds not broking
taken)
Chit Fund 
Companies Insurance 
engaged in the companies holding 
Companies as 
business of a certificate of 
defined in the Sec 
2 clause (b) of the Nidhi Companies
Venture Capital. registration issued by IRDA. Chit Fund Act, 1982
1. On the basis of the nature of Activity 
-
Asset Finance Company
Investment company
DIFFERENT   TYPES  Loan Company
 OF 
  NBFC's Core investment Company
Micro Finance Company
Housing Finance Company
Mortgage Guaratnee Company 
2. On the basis of Deposits
Deposit Accepting NBFC's
Non- Deposit Accepting NBFC's
HOW  TO  INCORPORATE   AN    NBFC
A company should first There should be a 
be registered under the The minimum net owned minimum of 1 Director The procedure to 
incorporate an NBFC is: Companies Act 2013 or funds of the Company 
from the same 
under Companies Act should be Rs. 2 Crore. background or a Senior 
1956. Banker as a full-time director in the Company.
After all of the above 
conditions have been 
The CIBIL records of the satisfied the online 
A Hard copy of the 
application also has to be 
Company should be application on the A CARN Number will be website of RBI should be generated. sent to the regional clean filled and submitted branch of the Reserve 
along with the requisite Bank of India.
documents.
After the application is 
properly scrutinized, the 
License will be given to 
the Company
When is NBFC 
License with RBI 
Required?
• The Reserve Bank of India regulates and 
supervises Non-Banking Financial Companies 
which are into the principal business of lending 
or acquisition of shares, stocks, bonds, etc., or 
financial leasing or hire purchase or accepting 
deposits. The principal business of financial 
activity is when a company’s financial assets 
constitute more than 50 per cent of the total 
assets and income from financial assets 
constitute more than 50 per cent of the gross 
income. A company which fulfils both these 
criteria must have NBFC license. This test for 
NBFC license is popularly known as the 50-50 
test.
• Therefore, companies engaged in agricultural 
operations, industrial activity, purchase and 
sale of goods, providing services or purchase, 
sale or construction of immovable property as 
their principal business and are doing some 
This Photo by Unknown author is licensed under CC BY-NC.
financial activity in a small way, will not require 
NBFC registration.
TYPES  OF  NBFC  LICENSE 
ASSET FINANCE INVESTMENT LOAN COMPANY INFRASTRUCTURE SYSTEMICALLY 
COMPANY(AFC) COMPANY FINANCE COMPANY IMPORTANT CORE 
INVESTMENT 
COMPANY
NBFC FACTOR INFRASTRUCTURE 
DEBT FUND
DOCUMENTS  REQUIRED
Certified copies of Certified copies of up-to-
Certificate of Incorporation date Memorandum and 
Information about the and Certificate of Articles of Association of 
management Commencement of the company. Details of 
Copy of PAN/CIN allotted to 
Business in case of public clauses in the 
the company.
limited companies. memorandum relating to financial business.
Statutory Auditors Statutory Auditors 
Directors’ profile, Certificate certifying that Certificate certifying that 
separately filled up and the company is/does not the company is not 
signed by each director. accept/is not holding carrying on any NBFC 
Public Deposit. activity
DOCUMENTS - 
Details of Authorised Share 
Statutory Auditors Certificate Capital and the latest Copy of Fixed Deposit receipt & 
certifying net owned fund as on shareholding pattern of the bankers certificate of no lien 
date of the application. company including the indicating balances in support 
percentages. of Net Owned Funds.
Business plan of the company 
Last three years Audited for the next three years giving 
Details of the bank balance sheet and Profit & Loss details of its (a) thrust of 
balances/bank account along with directors & business, (b) market segment 
accounts/complete postal auditors report or for such and (c) projected balance 
address of the branch/bank, shorter period as are available sheets, cash flow statement, 
loan/credit facilities etc. availed. (for companies already in asset/income pattern statement 
existence). without any element of public 
deposits.
Source of the startup capital of 
the company substantiated with Self-attested Bank Statement/IT 
documentary evidence. returns etc.
DOCUMENTS- 
Financial Statements of the last 2 
Certificate from the respective years of Unincorporated Bodies, Board Resolution specifically 
NBFC/s where the Directors have CIBIL Data pertaining to if any, in the group where the approving the submission of the 
gained NBFC experience. Directors of the company directors may be holding application and its contents and directorship with/without authorising signatory.
substantial interest.
Board Resolution to the effect 
that the company has not 
accepted any public deposit, in Board resolution stating that the 
the past (specify period)/does company is not carrying on any 
not hold any public deposit as on NBFC activity/stopped NBFC 
Certified copy of Board 
the date and will not accept the activity and will not carry 
Resolution for the formulation of 
same in future without the prior on/commence the same before 
“Fair Practices Code”.
approval of Reserve Bank of getting registration from RBI.
India in writing.
PROCESS  FOR  APPLYING  FOR NBFC
An application is to be submitted 
After your company has been online. With the required documents. The hard copies of the documents 
incorporated and has accumulated A Company Application Reference and the form as uploaded online, are 
the minimum NOF, you need to follow 1 Number (CARN) is generated upon 2 to be sent to the Regional Office of 
the below procedure to get it successful submission. This reference RBI, under whose jurisdiction your 
registered as an NBFC with RBI: number is of use during all future company falls.
inquiries and communications.
3
Please remember to keep the 
Once the submitted documents are required minimum capital in a deposit 
found to be ok, the regional office account, free from all liabilities. 
sends the application to the central If the company meets all the terms Generally, this amount is kept in a 
office of the RBI. There, the and conditions specified in Section 4 5 Fixed Deposit (FD). RBI shall verify 
application and the documents are 45-I A of the RBI Act, the NBFC this amount, after your application, as 
verified and a thorough background License shall be granted. the deposit of the company with the 
check is conducted. concerned bank.
THANK   YOU !!