The Reserve Bank of India (RBI) classifies non-banking financial companies (NBFC) into three categories: asset finance companies, loan companies and investment companies. All three types of NBFC are expected to maintain a minimum capital adequacy ratio of 12%.
New category
In light of the predominant role played by infrastructure financing NBFCs in recent times, in making available lines of credit to the infrastructure sector, a need has emerged for a separate class of infrastructure financing NBFCs.
The RBI, having accepted the need for a separate category of infrastructure financing NBFCs, has in a notification dated 12 February amended the Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007.
Shardul Thacker is a partner with Mulla & Mulla & Craigie Blunt & Caroe in Mumbai.
Mulla & Mulla & Craigie Blunt & Caroe
Mulla House, 51 MG Road
Fort, Mumbai 400 001
India
Tel: +91 22 2204 4960, 2262 3191
Fax: +91 22 2204 0246, 6634 5497
Email: info@mullaandmulla.com
