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NBFC & Financial Services Advisory in India – RBI NBFC Registration (CoR), Scale-Based Regulation, Fair Practices & Digital Lending, KYC / AML / PMLA, Capital Adequacy & SEBI / IRDAI Licensing

Non-Banking Financial Companies (NBFCs) and the wider financial-services sector are among the most heavily supervised businesses in India — answering to the Reserve Bank of India for the Certificate of Registration (CoR), Net Owned Fund, the Scale-Based Regulation (SBR) framework, the Fair Practices Code, the Digital Lending Guidelines, capital adequacy and asset-classification norms, and to SEBI and IRDAI for investment, advisory, and insurance activities — all over a backbone of KYC / AML obligations under the PMLA and FEMA rules for foreign capital. Authorisation and continuing compliance are non-negotiable, and the penalty for getting them wrong is severe.

Our NBFC and financial-services practice helps promoters and boards obtain and keep their licences and run clean operations — NBFC registration (CoR) and category selection, Scale-Based Regulation classification and compliance, Fair Practices, KYC / AML and PMLA frameworks, Digital Lending and co-lending structuring, capital-adequacy, provisioning and RBI returns, SEBI registrations (AIF / PMS / Investment Adviser / Research Analyst), insurance and IRDAI advisory, and FEMA / FDI structuring. Whether you are applying for a fresh CoR, transitioning into a higher SBR layer, launching a digital-lending product, or raising foreign capital, we build a regulator-ready institution.

RBI CoR
NBFC Registration
Scale-Based
SBR Framework
KYC / AML
PMLA Compliance
100% FDI
Automatic Route
Laws & Frameworks We Work Under
RBI Act 1934
NBFC CoR
Scale-Based Regulation (SBR)
Fair Practices Code
Digital Lending Guidelines
KYC Directions
PMLA & AML
CIC / Credit Reporting
Capital Adequacy (CRAR)
SEBI AIF / PMS / IA
IRDAI Licensing
FEMA NDI Rules

NBFC & Financial-Services Engagements We Handle

Licensing

NBFC Registration (CoR)

Obtaining a Certificate of Registration from the RBI — entity, capital, fit-and-proper, and the complete COSMOS application and follow-up.

  • Net Owned Fund planning
  • Category / layer selection
  • Fit-and-proper & directors
  • Business plan & projections
  • COSMOS application filing
  • RBI query handling
SBR

Scale-Based Regulation

Classifying the NBFC into the correct SBR layer and aligning governance, capital, and disclosure to layer-specific requirements.

  • Base / Middle / Upper layer
  • Layer-wise compliance map
  • Board & risk governance
  • Disclosure & policy suite
  • NPA / provisioning norms
  • Internal capital adequacy
Conduct

Fair Practices, KYC & AML

Building the conduct, customer-protection, and anti-money-laundering framework expected of every regulated lender.

  • Fair Practices Code
  • KYC / CDD policy
  • PMLA & FIU reporting
  • Grievance redressal
  • Interest / penal-charge policy
  • Outsourcing & recovery norms
Digital

Digital Lending & Co-Lending

Structuring digital-lending and partnership models in line with the RBI Digital Lending Guidelines and outsourcing norms.

  • Digital Lending compliance
  • LSP / partnership agreements
  • Co-lending (CLM) structuring
  • FLDG arrangement review
  • Data & privacy controls
  • Key fact statement (KFS)
Returns

RBI Returns & Supervision

Periodic RBI returns, statutory auditor reporting, and readiness for RBI inspection and supervisory engagement.

  • Periodic RBI returns
  • Statutory auditor cert (SAC)
  • CIC / bureau reporting
  • Capital-adequacy (CRAR)
  • Asset-classification & NPA
  • Inspection & risk assessment
Markets

SEBI & IRDAI Licensing

Registrations and compliance for fund management, portfolio and advisory services, research, and insurance distribution.

  • AIF registration & compliance
  • PMS / Investment Adviser
  • Research Analyst
  • Stock-broker / depository
  • Insurance broker / corporate agent
  • IRDAI conduct norms

Key NBFC & Financial-Services Concepts You Must Know

CoR

Certificate of Registration

No company can carry on NBFC business without a Certificate of Registration from the RBI, granted after capital, fit-and-proper, and business-plan scrutiny.

RBI Approval Mandatory
NOF

Net Owned Fund

An NBFC must maintain a minimum Net Owned Fund — currently ten crore rupees for many categories — with a regulatory glide path for existing NBFCs.

₹10 Crore Glide Path
SBR

Scale-Based Regulation

The RBI regulates NBFCs across Base, Middle, Upper, and (potentially) Top layers, with stricter governance and capital as size and systemic importance rise.

4 Layers Proportionate
FPC

Fair Practices Code

Every NBFC must adopt a Fair Practices Code governing loan terms, transparency, interest and penal charges, and recovery conduct toward borrowers.

Borrower Protection Transparency
Digital Lending

RBI DL Guidelines

Digital loans must be disbursed and repaid through regulated entities, with a Key Fact Statement, direct flow of funds, and controlled use of lending service providers.

KFS Direct Disbursal
PMLA

KYC & AML

NBFCs are reporting entities under the PMLA, with customer due-diligence, record-keeping, and suspicious-transaction reporting to the FIU.

CDD FIU Reporting
CRAR

Capital Adequacy

Deposit-taking and larger NBFCs must maintain a minimum capital-to-risk-weighted-assets ratio and follow prescribed asset-classification and provisioning norms.

Min CRAR Provisioning
FDI

Foreign Investment

FDI in NBFCs engaged in regulated financial services is permitted up to 100% under the automatic route, subject to minimum-capitalisation and FEMA conditions.

100% Automatic Conditions Apply

Our NBFC & Financial-Services Advisory

01

NBFC Registration (CoR)

Category selection, Net Owned Fund planning, fit-and-proper documentation, business plan, COSMOS application, and end-to-end RBI query handling.

02

Scale-Based Regulation

SBR layer classification, layer-wise compliance roadmap, governance and risk framework, and policy and disclosure suite alignment.

03

Fair Practices & Conduct

Fair Practices Code, interest and penal-charge policy, grievance redressal, outsourcing and recovery norms, and customer-protection framework.

04

KYC / AML & PMLA

KYC and customer due-diligence policy, AML program, FIU reporting setup, sanctions screening, and PMLA record-keeping.

05

Digital Lending & Co-Lending

Digital Lending Guidelines compliance, LSP and partnership agreements, co-lending structuring, FLDG review, and Key Fact Statement design.

06

RBI Returns & Reporting

Periodic RBI returns, statutory auditor certificate, CIC / bureau reporting, and supervisory-data and inspection support.

07

Capital Adequacy & Provisioning

CRAR computation, asset-classification and NPA norms, provisioning policy, and internal capital-adequacy assessment.

08

SEBI Registrations

AIF, PMS, Investment Adviser, Research Analyst, and broker / depository registration, compliance manuals, and periodic reporting.

09

IRDAI & Insurance

Insurance broker and corporate-agent licensing, conduct and disclosure compliance, and renewal and regulatory-return support.

10

FEMA & FDI Structuring

Foreign-investment structuring into NBFCs, minimum-capitalisation compliance, FC-GPR reporting, and downstream-investment rules.

11

Statutory & Internal Audit

Statutory audit, RBI-mandated internal / concurrent audit, IS audit, and controls testing for the lending and treasury functions.

12

Restructuring & Transactions

Portfolio sale / securitisation, NBFC acquisition due diligence, change-in-control approval, and group-structure advisory.

When a Financial-Services Business Needs an Advisor

Applying for a CoR

A fresh NBFC licence needs capital, fit-and-proper directors, a credible business plan, and a clean COSMOS application to clear RBI scrutiny.

Moving Up an SBR Layer

Crossing asset thresholds pushes an NBFC into a higher SBR layer with stricter governance, capital, and disclosure that must be implemented in advance.

Launching Digital Lending

A new app or partnership model must comply with the Digital Lending Guidelines on fund flow, KFS, FLDG, and lending-service-provider conduct.

RBI Inspection

An RBI inspection or supervisory query needs accurate data, sound policies, and a coordinated, well-documented response.

Raising Foreign Capital

Foreign investment into an NBFC must satisfy minimum-capitalisation, sectoral, and FEMA reporting conditions, with change-in-control approval where needed.

Change in Control

Acquisition or a material change in shareholding or management of an NBFC typically requires prior RBI approval and careful diligence.

Setting Up a Fund / Advisory

Launching an AIF, PMS, or investment-advisory business requires the right SEBI registration, structure, and compliance framework.

AML / KYC Gap

Weak customer due-diligence or reporting exposes the entity to PMLA penalties and supervisory action that demand urgent remediation.

Documents Needed for an NBFC Engagement

Corporate & Capital

  • Certificate of Incorporation, MOA / AOA
  • Shareholding & group structure
  • Net Owned Fund certificate
  • Directors' fit-and-proper / KYC
  • Board & shareholder resolutions
  • Banker's report
  • Auditor's certificate

Business & Compliance

  • Business plan & projections
  • Loan / product policies
  • Fair Practices & KYC policy
  • AML / PMLA program
  • Outsourcing & IT policy
  • Grievance-redressal mechanism
  • Digital-lending agreements

Financial & Regulatory

  • Audited financials (3 years)
  • Income-tax returns
  • RBI returns & SAC
  • Capital-adequacy working
  • Asset-classification / NPA data
  • FEMA / FC-GPR filings
  • SEBI / IRDAI registrations

Our NBFC Engagement Process

1

Diagnostic & Structuring

Activity and capital review, category / layer selection, and a licensing or compliance roadmap with regulator-readiness gaps mapped.

2

Application & Setup

Net Owned Fund alignment, fit-and-proper documentation, COSMOS / SEBI / IRDAI application, and the core policy suite.

3

Framework & Controls

Fair Practices, KYC / AML, digital-lending, and risk and capital frameworks, with internal-audit and reporting controls.

4

Returns & Supervision

Periodic RBI / SEBI / IRDAI returns, auditor certificates, and inspection and supervisory-engagement support.

5

Review & Scale

Compliance calendar, board reporting, and periodic review to keep the institution regulator-ready as it grows or changes layer.

Why Choose Us for NBFC & Financial Services

✓
End-to-end CoR licensing
✓
Scale-Based Regulation mapping
✓
Fair Practices & conduct
✓
KYC / AML / PMLA frameworks
✓
Digital-lending structuring
✓
RBI returns & inspection support
✓
SEBI / IRDAI registrations
✓
FEMA & FDI advisory

FAQs on NBFC & Financial Services in India

When does a company need an NBFC licence from the RBI?
A company needs a Certificate of Registration (CoR) from the RBI if its financial assets are more than 50% of total assets and its income from financial activity is more than 50% of gross income — the so-called 50-50 principal-business test. Activities such as lending, investment in shares / securities, leasing, hire-purchase, and acquisition of financial assets are covered. Carrying on NBFC business without a CoR is prohibited and attracts penal action. We assess whether the test is met and manage the registration.
What is the minimum capital (Net Owned Fund) for an NBFC?
Most NBFC categories must maintain a minimum Net Owned Fund (NOF) of ten crore rupees, with a regulatory glide path allowing existing NBFCs to reach the level in stages. NOF is essentially paid-up capital and free reserves, reduced by certain investments and intangible assets. Specialised categories (such as NBFC-MFI, NBFC-Factor, or infrastructure finance) and the deposit-taking status can change the requirement. We compute NOF and plan the capital build-up before application.
What is the Scale-Based Regulation (SBR) framework?
Under Scale-Based Regulation, the RBI supervises NBFCs across four layers — Base, Middle, Upper, and a possible Top layer — with regulatory intensity rising with size, activity, and systemic importance. Larger NBFCs in the Middle and Upper layers face stricter governance, capital, concentration, and disclosure norms, including a board-approved internal capital-adequacy process and, for the Upper layer, listing and additional requirements. We classify the NBFC and align its policies and governance to the correct layer.
What do the RBI Digital Lending Guidelines require?
The Digital Lending Guidelines require that loan disbursal and repayment flow directly between the borrower and the regulated entity (no pass-through via a lending service provider's account), that borrowers receive a Key Fact Statement (KFS) with the all-in cost (APR) before signing, and that data collection, storage, and the conduct of lending service providers are controlled. Arrangements such as first-loss default guarantees (FLDG) are permitted only within prescribed limits. We structure and document compliant digital-lending and partnership models.
What AML and KYC obligations apply to NBFCs?
NBFCs are reporting entities under the Prevention of Money Laundering Act (PMLA) and must follow the RBI KYC Directions — performing customer due-diligence, classifying customer risk, maintaining records, screening against sanctions lists, and filing Cash Transaction Reports and Suspicious Transaction Reports with the Financial Intelligence Unit (FIU-IND). A designated Principal Officer and a board-approved AML policy are required. Lapses attract significant penalties, so we build and test the KYC / AML framework.
Is foreign investment allowed in NBFCs?
Yes — FDI in NBFCs carrying on regulated financial-services activities is allowed up to 100% under the automatic route, subject to compliance with the FEMA Non-Debt Instruments Rules, applicable minimum-capitalisation norms for the activity, and the relevant financial-sector regulator's conditions. Investment must come through banking channels with FC-GPR reporting, and downstream-investment rules apply if the NBFC invests further. A change in control of an NBFC also needs prior RBI approval.
What SEBI or IRDAI licences might a financial-services firm need?
Beyond an RBI NBFC licence, market-facing activities are regulated by SEBI and IRDAI. SEBI registration is required to run an Alternative Investment Fund (AIF), a Portfolio Management Service (PMS), act as an Investment Adviser or Research Analyst, or operate as a stock-broker / depository participant. Insurance distribution requires an IRDAI broker or corporate-agent licence. Each comes with its own net-worth, certification, and compliance obligations, which we set up and maintain.

Licensed Fast. Compliant Always. Ready for Inspection.

Partner with our NBFC and financial-services experts for RBI registration, Scale-Based Regulation, Fair Practices and AML frameworks, digital-lending structuring, and SEBI / IRDAI licensing for FY 2026–27.

Talk to an NBFC Expert