Different types/categories of NBFCs registered with RBI

NBFCs are cat­e­go­rized a) in terms of the type of lia­bil­i­ties into Deposit and Non-Deposit accept­ing NBFCs, b) non deposit tak­ing NBFCs by their size into sys­tem­i­cal­ly impor­tant and oth­er non-deposit hold­ing com­pa­nies (NBFC-NDSI and NBFC-ND) and c) by the kind of activ­i­ty they con­duct. With­in this broad cat­e­go­riza­tion the dif­fer­ent types of NBFCs are as follows: 

1. Infra­struc­ture Debt Fund:Non- Bank­ing Finan­cial Com­pa­ny (IDF-NBFC) : IDF-NBFC is a com­pa­ny reg­is­tered as NBFC to facil­i­tate the flow of long term debt into infra­struc­ture projects. IDF-NBFC raise resources through issue of Rupee or Dol­lar denom­i­nat­ed bonds of min­i­mum 5 year matu­ri­ty. Only Infra­struc­ture Finance Com­pa­nies (IFC) can spon­sor IDF-NBFCs.
2. Sys­tem­i­cal­ly Impor­tant Core Invest­ment Com­pa­ny (CIC-ND-SI):CIC-ND-SI is an NBFC car­ry­ing on the busi­ness of acqui­si­tion of shares and secu­ri­ties which sat­is­fies the fol­low­ing con­di­tions:-

   (a) it holds not less than 90% of its Total Assets in the form of invest­ment in equi­ty shares, pref­er­ence shares, debt or loans in group companies;

   (b) its invest­ments in the equi­ty shares (includ­ing instru­ments com­pul­so­ri­ly con­vert­ible into equi­ty shares with­in a peri­od not exceed­ing 10 years from the date of issue) in group com­pa­nies con­sti­tutes not less than 60% of its Total Assets;

   © it does not trade in its invest­ments in shares, debt or loans in group com­pa­nies except through block sale for the pur­pose of dilu­tion or disinvestment;

   (d) it does not car­ry on any oth­er finan­cial activ­i­ty referred to in Sec­tion 45I© and 45I(f) of the RBI act, 1934 except invest­ment in bank deposits, mon­ey mar­ket instru­ments, gov­ern­ment secu­ri­ties, loans to and invest­ments in debt issuances of group com­pa­nies or guar­an­tees issued on behalf of group companies.

   (e) Its asset size is Rs 100 crore or above and

   (f) It accepts pub­lic funds

3. Infra­struc­ture Finance Com­pa­ny (IFC):IFC is a non-bank­ing finance com­pa­ny a) which deploys at least 75 per cent of its total assets in infra­struc­ture loans, b) has a min­i­mum Net Owned Funds of Rs. 300 crore, c) has a min­i­mum cred­it rat­ing of ‘A ‘or equiv­a­lent d) and a CRAR of 15%.
4. Loan Com­pa­ny (LC):LC means any com­pa­ny which is a finan­cial insti­tu­tion car­ry­ing on as its prin­ci­pal busi­ness the pro­vid­ing of finance whether by mak­ing loans or advances or oth­er­wise for any activ­i­ty oth­er than its own but does not include an Asset Finance Company.
5. Asset Finance Company(AFC): An AFC is a com­pa­ny which is a finan­cial insti­tu­tion car­ry­ing on as its prin­ci­pal busi­ness the financ­ing of phys­i­cal assets sup­port­ing productive/economic activ­i­ty, such as auto­mo­biles, trac­tors, lathe machines, gen­er­a­tor sets, earth mov­ing and mate­r­i­al han­dling equip­ments, mov­ing on own pow­er and gen­er­al pur­pose indus­tri­al machines. Prin­ci­pal busi­ness for this pur­pose is defined as aggre­gate of financ­ing real/physical assets sup­port­ing eco­nom­ic activ­i­ty and income aris­ing there­from is not less than 60% of its total assets and total income respectively.
6. Invest­ment Com­pa­ny (IC): IC means any com­pa­ny which is a finan­cial insti­tu­tion car­ry­ing on as its prin­ci­pal busi­ness the acqui­si­tion of securities,
7. Non-Bank­ing Finan­cial Com­pa­ny — Micro Finance Insti­tu­tion (NBFC-MFI):NBFC-MFI is a non-deposit tak­ing NBFC hav­ing not less than 85%of its assets in the nature of qual­i­fy­ing assets which sat­is­fy the fol­low­ing cri­te­ria:

   loan dis­bursed by an NBFC-MFI to a bor­row­er with a rur­al house­hold annu­al income not exceed­ing Rs. 60,000 or urban and semi-urban house­hold income not exceed­ing Rs. 1,20,000;

   b. loan amount does not exceed Rs. 35,000 in the first cycle and Rs. 50,000 in sub­se­quent cycles;

   c. total indebt­ed­ness of the bor­row­er does not exceed Rs. 50,000;

   d. tenure of the loan not to be less than 24 months for loan amount in excess of Rs. 15,000 with pre­pay­ment with­out penalty;

   e. loan to be extend­ed with­out collateral;

   f. aggre­gate amount of loans, giv­en for income gen­er­a­tion, is not less than 75 per cent of the total loans giv­en by the MFIs;

   g. loan is repayable on week­ly, fort­night­ly or month­ly instal­ments at the choice of the borrower

8. Non-Bank­ing Finan­cial Com­pa­ny – Fac­tors (NBFC-Fac­tors):NBFC-Fac­tor is a non-deposit tak­ing NBFC engaged in the prin­ci­pal busi­ness of fac­tor­ing. The finan­cial assets in the fac­tor­ing busi­ness should con­sti­tute at least 75 per­cent of its total assets and its income derived from fac­tor­ing busi­ness should not be less than 75 per­cent of its gross income.