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Priyanka Bajpayee
| Updated: 19 Mar, 2020 | Category: NBFC

Documents Required for NBFC Registration

NBFC Registration Documents

NBFC is the financial institution that provides a variety of banking and non-banking services to the consumers. NBFCs in India are supervised and regulated by the Reserve Bank of India. Any Company cannot commence the business of Non-Banking Financial Company without obtaining a Certificate of Registration from the RBI. The entire process of NBFC Registration from company incorporation till obtaining the Certificate of Registration requires proper documentation. An applicant Company is required to arrange proper documents to obtain a Certificate of Incorporation.

In this topic, we will discuss the documentation required for NBFC registration, but before that, we will discuss what NBFC, Types of NBFCs, and the steps required for NBFC registration.

What is NBFC?

NBFC is a Non-Banking Financial Company that provides long term and specialized credit facilities and attracts foreign grants. The process of NBFC registration is very lengthy, and the applicant is required to comply with the rules and regulations of RBI.

NBFCs facilitate all the banking related financial services. The services of the NBFC are flexible, which helps the client in getting all the updates and also helps in meeting the needs of the specific client.

To carry out the new segment, NBFCs are offering a wide range of products like Financing, leasing, Housing Finance. Through advance technology and enhanced experience, NBFCs[1] are majorly focusing on the customer segment.

Types of NBFC

Based on the kind of activities, NBFC are of 3 types –

  • Deposit-taking NBFCs
  • Non-Deposit taking NBFCs
  • NBFC-ND-Systematically Important

Steps Required in NBFC Registration

Before obtaining the NBFC registration, various steps are required to comply with. Below mentioned are the steps that are required before NBFC Registration-

  • Company Incorporation under the Companies Act,2013.
  • Net owned fund should be Rs 2 crore.
  • 1 director of the company shall be an Independent Director dealing in the professional capacity.
  • To register as NBFC, a good CIBIL score of the director/subscriber is required.
  • Filing of COSMOS, i.e. Submitting the documents online on RBI’s official website.
  • CARN will be generated; once the form is filed by the applicant online along with the requisite documents.
  • Submission of a physical copy of the documents to the regional branch of Reserve Bank of India.
  • After document submission, the application is checked and verified by the RBI, and in case of no further verification and query, the department will grant COR to the applicant company.

Read our article:NBFC Registration – Know the Entire Incorporation Procedure

What are the Documents Required for NBFC Registration?

For NBFC Registration, various documents are required at the time of incorporation or after incorporation of the company.

  • Certificate of Incorporation of the Company.
  • Memorandum of Association and Article of Association.
  • Detailed Information about the Director and subscriber of the Company-

From the Directors-

  • Highest Qualification Certificate
  • Id and Address Proof of Director
  • Experience Certificate
  • Net Worth Certificate
  • Details of Directorship in other companies, if any
  • Business Profiles
  • Banker’s report
  • CIBIL

From the Shareholders-

  • Id and Address Proof of the Subscriber
  • Banker’s Report
  • Net worth Certificate
  • CIBIL

Along with the above documents, documents related to the Applicant Company and its working is also required-

  • PAN Card of the Company
  • Proper disclosure in the Annexure I, II and III.
  • Certified COI, MOA, and AOA.
  • Shareholding details
  • Details of Banker and Auditor.
  • Business Layout
Note: For NBFC Registration, all the documents are required both in Online and Physical form. The Department or NBFC Consultants can also ask for the other necessary documents apart from the above-mentioned documents.

All the documents shall be self-attested by the directors and the subscriber.

Operating the NBFC is equally important as registering the NBFC, and for that, it is important to fulfil the NBFC annual compliances. To avoid the fraudulent practices and for preventing speculation, the compliances of Reserve Bank of India is getting tougher day by day. Proper documentation and compliances are required to be fulfilled by the NBFC to avoid the penalties.

Once the NBFC is registered, it is required to be fulfilled with the Post Registration compliances-

  • Income Tax return
  • ROC Return
  • Statutory Audit
  • NBS Returns
  • Membership from the Credit Rating Agencies
  • KYC registration
  • FIU Registration.

All the above-mentioned compliances also require proper documentation and analysis to provide better services and transparency to the borrower.

Takeaway

Registration of NBFC requires coordination which ensures better management and conformity of norms. Registration of NBFC is required to meet the criteria defined by the Companies Act, 2013 and Reserve Bank of India. Proper documentation and Compliances results in transparency and confidence in the mind of the people. To build a strong connection, the main objective of NBFC is to focus on the needs of the customer and fulfil all the necessary compliances.

For more details, Contact Corpbiz, our team of professionals will assist you in NBFC Registration and Post compliances after NBFC Registration.

Read our article:Are you running an NBFC? Get updated about the list of Annual Compliances Prescribed by the RBI

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Priyanka Bajpayee

Priyanka Bajpayee has done Masters in International Business Law and well versed in content writing covering the area of legal and finance. Also, she has practical experience of almost 1.5 years in Legal compliance and secretarial work.

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