What changed
RBI superseded the 1998 Prudential Norms Directions with two distinct sets: one for deposit-taking NBFCs (including RNBCs) and another for non-deposit-taking NBFCs, effective February 22, 2007. A key change is that all NBFCs and RNBCs with total assets of ₹100 crore or more must now file the NBS 6 return monthly within seven days of month-end, starting with the month ending April 30, 2007. NBFCs with deposits of ₹50 crore or more must continue submitting the Capital Market Exposure return monthly until March 31, 2007, after which revised instructions will apply.
What it means for you
This bifurcation simplifies compliance by tailoring norms to the specific risk profiles of deposit-taking versus non-deposit-taking NBFCs. The new monthly reporting requirement for larger NBFCs (assets ≥₹100 crore) will enhance RBI's surveillance of systemic risks, requiring lenders to tighten their data reporting processes. NBFCs with significant deposit bases must also prepare for revised capital market exposure reporting post-March 2007.
What you must do
- Identify whether your NBFC is deposit-taking or non-deposit-taking and comply with the respective 2007 Directions.
- If total assets are ₹100 crore or more, set up systems to submit NBS 6 return monthly within 7 days of month-end, starting April 30, 2007.
- If deposits are ₹50 crore or more, continue filing Capital Market Exposure return monthly until March 31, 2007, and watch for revised instructions.
- Review and update internal prudential norms policies to align with the new separate directions.
Who it affects
All deposit-taking NBFCs (including RNBCs), All non-deposit-taking NBFCs, Systemically important non-deposit-taking NBFCs, NBFCs with total assets of ₹100 crore or more, NBFCs with deposits of ₹50 crore or more
What is the key reporting change for large NBFCs?
NBFCs and RNBCs with total assets of ₹100 crore or more must now submit the NBS 6 return on a monthly basis within seven days of the close of the month. The first such return is due for the month ending April 30, 2007.
Do the old 1998 Prudential Norms still apply?
No, the 1998 Prudential Norms Directions have been superseded by two separate sets of Directions issued on February 22, 2007—one for deposit-taking NBFCs and one for non-deposit-taking NBFCs. All NBFCs must now comply with the relevant 2007 Directions.
What about NBFCs with deposits of ₹50 crore or more?
They must continue submitting the Capital Market Exposure return as before until the month ending March 31, 2007. After that, revised instructions will apply, so they should stay alert for further RBI communication.