With the growth of the economy, the demands of financial services have grown and this has led to a spurt in the registration of NBFCs (Non-Banking Finance Company) in India.
Banks have a limited reach as they are bound by rigid rules and regulations, thus, they are unable to cater to the needs of all. There existed a huge gap between demand and supply, leaving a vacuum.
The NBFCs very smartly and strategically creeped into this space and today they are a major player in shaping the future of the country.
Contemplating Venturing Into NBFC Space?
Wanting to step into the world of NBFC, naturally, you will want to do it at the earliest!
For initiating the process, you need to zero in on the most reliable and efficient consultant who would inform, guide and hold hands till the incorporation of your company as an NBFC.
Expert and experienced professional firm will help your company to scale the entire journey smoothly, as there are numerous factors to be adhered to.
Confused Over How To Select The Finest Consultant Firm?
Like for all other services, the same factors aid in shortlisting and selecting the best NBFC Registration Consultant in India- research, review, referral, etc.
There is a parameter on which you can test the worthiness of a company:
- Performance record
- Most competent employees
- Adapting modernization techniques
- Time-bound results
- Success rate
- Client reviews
But then the question is that there are hundreds of such firms and to research all of them and find out one, is not possible.
Why Should You Trust MUDS?
MUDS- The Management Consultancy Firm is committed to complete solutions!
Approach MUDS for unparalleled services as it is a firm which provides the best of services and has proven its efficiency in the years since its inception.
- The mission of the firm is, “Challenging ourselves to bring new and original ways of thinking.”
- The Firm conforms to all the above-mentioned criteria in totality and boasts of an exemplary team of professionals.
- Their team comprises of a mix of professionals from diverse backgrounds resulting in catering to all kinds of clients.
- MUDS has a completely dedicated team for NBFC registration which has helped many companies in getting NBFC license in record time.
- The team is adept to comprehend the clients’ circumstances and requirements and dispense reliable, honest and thoroughgoing advice accordingly.
- MUDS stands out as the best registration consultant in India as it always lays great emphasis on professional and ethical accountability and therefore, it is result oriented and cost-effective.
- With their pan India presence, they extend services everywhere, guiding and supporting at every step.
“Our steadfast commitment & professional fairness has led to forging a long-lasting relationship with all our clients.”
– Kritika Chabbra (Market Analyst, MUDS Management Pvt. Ltd.)
What Will MUDS Do?
MUDS will be with you from initiation to completion, that is, till NBFC incorporation.
The NBFCs do not hold banking license but they offer almost every service that banks do including accepting deposits, offering loans, performing financial inter-mediation, offering cash advances, leasing, hire-purchase, etc.
Section 45-IA mandates that no NBFC shall begin or carry on the business of a Non-Banking Financial Institution without obtaining a Certificate of Registration (COR) from the RBI.
One should be ready with this pre-work before seeking NBFC incorporation:
- Company should be registered under the Companies Act, 2013 or Companies Act, 1956
- Company should have Minimum Net Owned Fund of INR 2 crore
(Net Owned Funds to be calculated on the basis of the last audited balance sheet of the Company)
Be Aware of The Businesses That NBFCs Can Offer:
There is a wide scope of business opportunities for NBFCs in India:
- Insurance Business,
- Loans and Advances,
- Chit Business,
- Acquisition of shares/ stocks/ securities/ bonds/ debentures issued by the Government or other authorities,
Services that NBFCs cannot offer:
RBI clearly defines the domains which cannot be touched by the NBFCs:
- agricultural activity,
- industrial activity,
- purchase or sale of any goods (other than securities), or
- providing any services, sale or purchase or construction of an immovable property.
For the purpose of registration, the RBI has categorized the NBFCs into two types, the first one is Type-I, NBFC (NBFC-ND) and the second one is Type-II, NBFC (NBFC-ND).
Type-I NBFC (NBFC-ND) are those which are not accepting public funds/ not intending to accept public funds in the future and not having customer interface/not intending to have customer interface in the future.
Type-II NBFC (NBFC-ND) are those which are accepting public funds/ intending to accept public funds in the future and/or having customer interface/intending to have customer interface in the future.
The RBI has categorically stated that Type-I NBFCs shall be subjected to less intensive scrutiny or due diligence and the processing of such applications shall be put on the fast track for processing. However, they shall be barred from accessing the public funds or having customer interface.
The Procedure of Registration of NBFCs In Brief:
It shall be beneficial for you to know in brief about the NBFC Registration Procedure:
- First is the incorporation of the applicant company under the Companies Act, 1956 or 2013, with Minimum Net Owned Fund of INR 2 crore.
- Then the applicant company needs to open a Bank Account and keep the entire sum of INR 2 crores in the bank’s deposit account, which should be free from all liens.
- The applicant is then required to apply for registration online on RBI’s official COSMOS website.
- Post submission of the form, CARN (Company Application Reference Number) is generated that is helpful in future references.
- Subsequently, the hard copies of all the documents are required to be submitted to the concerned Regional Office of RBI.
- The Regional Office shall scrutinize the authenticity of the documents and on being satisfied, shall forward it to the Central Office.
- The Central Office of RBI grants the NBFC registration only after the fulfillment of all prescribed requirements by the company under section 45-IA, of its act of 1934.
Thus, it is evident that there are lots of factors to be looked into and coordinated for expediting the process of registration of NBFC.
“The earnest devotion, honest dedication and ardent professionalism of each one of our team members is undoubtedly the principal reason for our steadfast progress over the years!”
-Shweta Gupta, Founder, and CEO, MUDS