NBFC Registration in India — RBI License & Application Process
NBFC registration with the Reserve Bank of India requires a minimum Net Owned Fund (NOF) of ₹10 crore for new applicants. The application is filed through RBI's COSMOS portal under Section 45-IA of the RBI Act, 1934. Our expert team guides you through every step — from company incorporation to Certificate of Registration.
NBFC Registration Consultation
Discuss your NBFC setup requirements with our experts
What is NBFC Registration?
NBFC registration is the mandatory process of obtaining a Certificate of Registration (CoR) from the Reserve Bank of India (RBI) to operate as a Non-Banking Financial Company in India. Under Section 45-IA of the RBI Act, 1934, no company can carry on the business of a non-banking financial institution without obtaining registration from RBI.
A Non-Banking Financial Company (NBFC) is a company registered under the Companies Act, 2013 that engages in lending, investment, acquisition of shares/securities, leasing, hire-purchase, insurance, or chit-fund business. NBFCs play a critical role in India's financial ecosystem by providing credit to underserved sectors.
The Reserve Bank of India regulates NBFCs through the Department of Non-Banking Regulation (DNBR). Since October 2022, RBI has implemented a scale-based regulation (SBR) framework that classifies NBFCs into four layers — Base, Middle, Upper, and Top — with progressively higher governance and compliance requirements.
Types of NBFC in India
| Type | Full Form | Primary Activity | Min NOF |
|---|---|---|---|
| NBFC-ICC | Investment & Credit Company | Lending, investment in shares/securities, asset finance | ₹10 crore |
| NBFC-MFI | Micro Finance Institution | Microloans to low-income borrowers (max ₹1.25 lakh annual household income) | ₹5 crore |
| NBFC-Factor | Factoring Company | Acquiring receivables (factoring business under Factoring Act, 2011) | ₹10 crore |
| NBFC-P2P | Peer-to-Peer Lending Platform | Online platform connecting lenders and borrowers | ₹2 crore |
| NBFC-AA | Account Aggregator | Consent-based data sharing between financial institutions | ₹2 crore |
| HFC | Housing Finance Company | Housing loans and property finance (regulated by NHB/RBI) | ₹25 crore |
| NBFC-IFC | Infrastructure Finance Company | Long-term infrastructure lending (min 75% assets in infra) | ₹300 crore |
| CIC | Core Investment Company | Holding company — investment in group companies (min 90% assets) | ₹100 crore |
NBFC Registration Requirements
| Requirement | Details |
|---|---|
| Company Incorporation | Must be a company registered under the Companies Act, 2013 with NBFC objects in the Memorandum of Association (MOA) |
| Minimum Net Owned Fund (NOF) | ₹10 crore for new NBFC-ICC applicants (₹5 crore for NBFC-MFI, ₹2 crore for P2P/AA) |
| NOF Composition | Must be in form of fixed deposits with scheduled commercial banks or government securities. No encumbrance. |
| Director Experience | At least one-third of directors should have relevant financial sector experience (banking, NBFC, finance) |
| Business Plan | Detailed 5-year business plan with financial projections, target market, product strategy, and risk management framework |
| CIBIL Score | All directors/promoters must have clean credit history. No defaults, willful defaulters disqualified. |
| Criminal Record | No director should have criminal conviction or pending criminal case related to financial fraud |
| Compliance Infrastructure | Fair Practices Code, KYC/AML policy, IT infrastructure, grievance redressal mechanism must be in place |
NBFC Registration Process — Complete Guide
Step 1
Incorporate Company with NBFC Objects
Register a company under the Companies Act, 2013 with NBFC-specific objects clearly stated in the Memorandum of Association. The company name should ideally reflect financial services activity. Minimum 2 directors and 2 shareholders required.
Step 2
Build Minimum Net Owned Fund (₹10 Crore)
Infuse the required minimum capital into the company. The NOF must be parked in fixed deposits with scheduled commercial banks or invested in government securities. Obtain a Chartered Accountant certificate confirming NOF availability and composition.
Step 3
Prepare Business Plan & Compliance Framework
Draft a comprehensive 5-year business plan including: target market analysis, product details, revenue projections, risk management strategy, Fair Practices Code, KYC/AML policy, IT infrastructure plan, and governance framework.
Step 4
Apply on RBI's COSMOS Portal
Submit the online application through the COSMOS (Company-wise Online Monitoring System) portal of the Reserve Bank of India. Upload all documents including: board resolution, CA certificate for NOF, business plan, director details, banker's report, and compliance policies.
Step 5
RBI Scrutiny & Site Inspection
RBI reviews the application, may raise queries requiring response within prescribed timelines. A site inspection of the registered office may be conducted. RBI verifies: adequacy of capital, directors' fit-and-proper criteria, viability of business plan, and readiness of compliance infrastructure.
Step 6
Receive Certificate of Registration (CoR)
Upon satisfactory review, the Reserve Bank of India issues the Certificate of Registration (CoR) under Section 45-IA. The CoR specifies the type of NBFC activity permitted. NBFC can now commence financial services operations as per the registered category.
Documents Required for NBFC Registration with RBI
Company Documents
Certificate of Incorporation, MOA & AOA (with NBFC objects), PAN card, Board Resolution authorizing the application, and certified copies of latest audited financial statements.
Capital & Financial Proof
CA certificate confirming Net Owned Fund (NOF) of ₹10 crore, FD receipts/government securities details, banker's report from the company's bank, and auditor's certificate on source of funds.
Director Documents
PAN, Aadhaar, passport of all directors, CIBIL reports, educational qualifications, experience certificates in financial services, declaration of fit-and-proper criteria, and no criminal record affidavit.
Business Plan & Projections
Detailed 5-year business plan with: target market, product types, pricing strategy, distribution model, revenue projections, profit & loss forecasts, capital adequacy ratios, and risk mitigation strategy.
Compliance Policies
Fair Practices Code (FPC), KYC/AML policy, grievance redressal mechanism, IT policy, data privacy framework, and internal audit structure document.
Infrastructure Proof
Registered office address proof with NOC, details of IT systems/software for loan management, organisational structure chart, and human resource plan.
NBFC Registration Fees & Costs
| Component | Amount | Notes |
|---|---|---|
| Minimum Net Owned Fund (NOF) | ₹10 crore (NBFC-ICC) | Primary capital requirement; must be unencumbered |
| RBI Application Fee | ₹50,000 | Non-refundable processing fee paid at the time of application |
| Company Incorporation | ₹15,000 – ₹30,000 | If company not yet incorporated; includes DSC, DIN, SPICe+ |
| Professional/Consultant Fees | ₹3 – ₹5 lakh | CS/CA firm fees for complete application preparation & filing |
| Business Plan Drafting | Included in professional fees | 5-year financial projections, market analysis, risk framework |
| Compliance Setup | ₹50,000 – ₹1 lakh | FPC, KYC/AML policy, IT systems, grievance mechanism |
| Total Investment | ₹10+ crore | Predominantly the NOF requirement (capital stays in company) |
Important: The ₹10 crore NOF is not a fee — it is your company's own capital that remains as an asset. It must be maintained throughout the NBFC's operations as per RBI's minimum capital adequacy requirements.
RBI Scale-Based Regulation Framework for NBFCs
The Reserve Bank of India introduced the Scale Based Regulation (SBR) framework effective October 2022 to regulate NBFCs based on their size, activity, and systemic importance. The framework classifies all NBFCs into four regulatory layers with progressively higher compliance requirements.
| Layer | Asset Size Criteria | Governance Requirements | Key Compliance |
|---|---|---|---|
| Base Layer (BL) | Asset size < ₹1,000 crore | Basic governance norms | Standard NBS returns, basic capital adequacy (15%) |
| Middle Layer (ML) | Asset size ≥ ₹1,000 crore | Enhanced governance, independent directors | CRAR 15%, NPA norms, internal audit, risk committee |
| Upper Layer (UL) | Top 10 by asset size + identified by RBI | Bank-like governance standards | Listed entity norms, CRO appointment, stress testing |
| Top Layer (TL) | Ideally empty — extreme risk NBFCs | Highest regulatory scrutiny | Enhanced surveillance, potential bank conversion |
New NBFCs typically start in the Base Layer. As asset size grows, they move into higher layers with additional compliance obligations. Read our detailed guide on RBI's Scale-Based Regulation for NBFCs for comprehensive understanding.
Ongoing NBFC Compliance After Registration
After receiving the Certificate of Registration from RBI, an NBFC must maintain continuous compliance with both RBI regulations and the Companies Act, 2013. Non-compliance can lead to cancellation of the registration certificate.
| Compliance | Frequency | Filed With |
|---|---|---|
| NBS-7 (Monthly Return) | Monthly (within 7 days of month end) | RBI |
| ALM Statements (Structural Liquidity) | Monthly/Quarterly | RBI |
| Statutory Auditor's Certificate | Annually | RBI |
| Annual Return of Deposits (NBS-1) | Annually | RBI |
| Capital Adequacy Return | Quarterly | RBI |
| ROC Annual Filing (AOC-4, MGT-7) | Annually | MCA/ROC |
| Board Meetings | Minimum 4 per year | Internal (minutes filed) |
| Fair Practices Code Compliance | Ongoing | Internal + RBI audit |
Our NBFC compliance services cover all ongoing RBI and MCA regulatory requirements — from monthly NBS returns to annual audit coordination. We ensure your NBFC maintains its Certificate of Registration without interruption.
Why Choose Deepa Sharma & Associates for NBFC Registration
Specialized NBFC Expertise
Deep understanding of RBI regulations, NBFC Master Directions, scale-based regulation framework, and COSMOS portal filing procedures. We've helped multiple NBFCs secure their Certificate of Registration.
End-to-End Handholding
From initial feasibility assessment to Certificate of Registration — we manage company incorporation, NOF structuring, business plan drafting, COSMOS application, RBI query responses, and post-registration compliance setup.
RBI Query Management
RBI frequently raises queries during application review. Our team drafts precise responses within prescribed timelines, ensuring no delays in the registration process due to inadequate or late replies.
Ongoing Compliance Support
Registration is just the beginning. We provide continuous NBFC compliance services — monthly RBI returns, quarterly ALM statements, annual audits, board meeting management, and governance advisory.
Related NBFC & Compliance Resources
NBFC Compliance Services (RBI)
Ongoing compliance management for registered NBFCs — monthly returns, ALM reports, annual filings, and governance framework.
RBI Scale-Based Regulation Guide
Complete guide to RBI's 4-layer scale-based regulation framework for NBFCs implemented from October 2022.
Corporate Compliance Services
Annual ROC/MCA compliance, board meeting management, and statutory filings for your NBFC company.
Company Incorporation
If your NBFC is not yet incorporated, we handle complete company registration with NBFC-specific MOA objects.
Secretarial Audit
Secretarial audit under Section 204 — mandatory for NBFCs in the Middle and Upper layers of SBR framework.
Company Secretary Services
Full range of CS services for your NBFC — from board governance to regulatory advisory.
Frequently Asked Questions About NBFC Registration
How to register an NBFC in India?
NBFC registration involves 6 steps: (1) Incorporate a company with NBFC objects in the MOA, (2) Build minimum Net Owned Fund of ₹10 crore in fixed deposits or government securities, (3) Prepare a 5-year business plan with financial projections, (4) Apply through RBI's COSMOS portal with all documents, (5) Respond to RBI queries and facilitate site inspection, (6) Receive Certificate of Registration. The process takes 3-6 months from application to CoR.
Is NBFC registration compulsory?
Yes, NBFC registration with RBI is mandatory under Section 45-IA of the RBI Act, 1934. Any company that wants to carry on non-banking financial institution business (lending, investment, asset finance, hire-purchase, etc.) must obtain a Certificate of Registration from the Reserve Bank of India before commencing operations. Operating without registration is a criminal offence punishable with imprisonment up to 5 years or fine up to ₹5 lakh or both.
How much does an NBFC license cost?
The primary cost is the minimum Net Owned Fund (NOF) of ₹10 crore (for NBFC-ICC). This is your company's own capital that stays as an asset. Additional costs include: RBI application fee (₹50,000), company incorporation (₹15,000-₹30,000), professional consultant fees (₹3-5 lakh), and compliance setup (₹50,000-₹1 lakh). Total investment is minimum ₹10 crore, predominantly the NOF requirement.
Is RBI still issuing NBFC licenses in 2026?
Yes, RBI continues to accept and process NBFC registration applications through the COSMOS portal. However, eligibility criteria have been tightened significantly — minimum NOF increased to ₹10 crore for new NBFC-ICC applicants. RBI has also tightened the fit-and-proper criteria for directors and requires detailed business plans and compliance infrastructure before granting registration.
What is the minimum capital required for NBFC?
Minimum Net Owned Fund varies by NBFC type: NBFC-ICC requires ₹10 crore, NBFC-MFI requires ₹5 crore, NBFC-P2P and Account Aggregator require ₹2 crore, Housing Finance Company (HFC) requires ₹25 crore, and Infrastructure Finance Company requires ₹300 crore. NOF is calculated as: Paid-up capital + Free reserves − Accumulated losses − Deferred revenue expenditure − Intangible assets.
How long does NBFC registration take?
NBFC registration typically takes 3-6 months from application submission to Certificate of Registration. Breakdown: company incorporation (2-3 weeks if not already done), NOF arrangement and documentation (4-8 weeks), COSMOS portal application (1 week), RBI processing and query responses (8-16 weeks), and final approval. Delays occur if RBI raises multiple rounds of queries.
What is the difference between NBFC registration and NBFC compliance?
NBFC registration is the one-time process of obtaining a Certificate of Registration from RBI to commence operations. NBFC compliance refers to ongoing regulatory obligations after registration — monthly NBS returns, quarterly ALM statements, annual audited financials, Fair Practices Code adherence, capital adequacy maintenance, and governance requirements under RBI's scale-based regulation. We offer both ongoing NBFC compliance services separately.
NBFC registration is done under which act?
NBFC registration is governed by Section 45-IA of the Reserve Bank of India Act, 1934. The company must also be incorporated under the Companies Act, 2013. Additional regulatory framework includes: RBI Master Directions on Non-Banking Financial Companies, Scale Based Regulation framework (effective October 2022), and various circulars from the Department of Non-Banking Regulation (DNBR).
Can RBI cancel an NBFC registration?
Yes, RBI can cancel the Certificate of Registration under Section 45-IA(6) if the NBFC: ceases to carry on NBFC business, fails to comply with RBI directions, fails to maintain minimum NOF, provides false/misleading information, or acts against public interest. RBI publishes a list of NBFCs whose registrations have been cancelled on its website.
What are the activities permitted for an NBFC?
An NBFC can engage in: lending (term loans, working capital), investment in shares/securities/bonds, hire-purchase, leasing, factoring, microfinance, infrastructure finance, and housing finance — depending on the type of registration obtained. An NBFC cannot accept demand deposits, cannot issue cheques drawn on itself, and is not part of the payment and settlement system.
Planning to Start an NBFC?
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