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7/21/2019 Directions Applicable to NBFCs
1/13
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.
7/21/2019 Directions Applicable to NBFCs
2/13
A. Deposit Acceptance RelatedRegulations
i. Ceiling on #uantum of publicdeposits
ii. Investment in li#uid assets
iii. $eriods of deposits
7/21/2019 Directions Applicable to NBFCs
3/13
1. Ceiling on quantum of publicdeposits
%oan and investment companies " &.' times of N(F ifthe compan has N(F of Rs. )** la+h! minimuminvestment grade,-I credit rating! complies withall the prudential norms and has CR0R of &' percent.
0sset 1nance companies,0FCs 2 if compan hasN(F of Rs.)** la+h and complies with all theprudential norms.
3ith -I credit rating and &) percent CR0R" 4 times
of N(F.3ithout -I credit rating but CR0R &' percent orabove" &.' times of N(F! or Rs. &* crore! whichever isless.
7/21/2019 Directions Applicable to NBFCs
4/13
2. Inestment in liquidassets
NBFCs 2 &' percent of outstandingpublic deposit liabilities as at theclose of business on the last wor+ing
da of the second preceding #uarter!of which
Not less than &* percent in approved
securities! and
Not more than ' percent in termdeposits with scheduled commercial
ban+s.
7/21/2019 Directions Applicable to NBFCs
5/13
!. "eriod of deposits
No demand deposits.
NBFCs 2 &) to 5* months
RNBCs 2 &) to 64 months-NBCs ,chit funds 2 5 to 75 months
7/21/2019 Directions Applicable to NBFCs
6/13
B. "rudential norms applicableto onl# t$ose NBFCs %$ic$
are accepting&$olding publicdeposits
i. Capital to ris+ assets ratio ,CR0Rii. Reporting sstem8 half earl return
7/21/2019 Directions Applicable to NBFCs
7/13
1. Capital to ris' assetsratio (CRAR)
The NBFCs holding/accepting public depositsare re#uired to maintain CR0R as under8
9#uipment leasing companies/hire purchase
1nance companies ,with -I credit rating:&) percent
9#uipment leasing companies/hire purchase
1nance companies,without minimum
investment grade credit rating : &' percent%oan/investment companies : &' percent
RNBCs : &) percent
7/21/2019 Directions Applicable to NBFCs
8/13
2. Reporting *#stem+ ,alf#earl# return
;alf earl returns to be submitted
as at the end of march andseptember ever ear.
Time allowed for submission 2 threemonths from the due date.
The return to be certi1ed b thestatutor auditors of the compan.
7/21/2019 Directions Applicable to NBFCs
9/13
. ru en a norms app ca e oall NBFCs irrespectie of %$et$ert$e# accept&$old public deposits
or not.
i. Income Recognition Norms
ii. N$0 Norms
iii. Restrictive Norms
iv. 0ccounting
7/21/2019 Directions Applicable to NBFCs
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
7/21/2019 Directions Applicable to NBFCs
11/13
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
7/21/2019 Directions Applicable to NBFCs
12/13
!. 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.
7/21/2019 Directions Applicable to NBFCs
13/13
. Asset classi/cation
0ll forms of credit ,includingreceivables to be classi1ed into fourcategories8"