What changed
RBI issued a master circular consolidating all prior directions/instructions for SCs/RCs up to June 30, 2008. It covers registration application format, minimum owned fund requirements, business commencement timeline, quarterly reporting (SCRC1 & SCRC2), and annual audited balance sheet submission. The circular also references separate updated guidelines in DNBS (PD) CC. No.10.
What it means for you
SCs/RCs must maintain a minimum owned fund of 15% of total financial assets acquired or Rs.100 crore (whichever lower) until asset realization and security receipt redemption. They must commence business within 6 months of registration (extendable up to 12 months). Quarterly returns (SCRC1/SCRC2) are due within 15 days of quarter-end, and audited balance sheets must be submitted within one month of the AGM.
What you must do
- Ensure SC/RC maintains minimum owned fund of 15% of assets or Rs.100 crore (whichever lower) until full asset realization.
- Submit quarterly SCRC1 and SCRC2 statements within 15 days of each quarter-end.
- File audited balance sheet with Directors/Auditors Report within one month of AGM, starting with balance sheet as on March 31, 2008.
- Verify business commencement within 6 months of registration; apply for extension if needed (max 12 months).
- Invest in Security Receipts issued by trust at least 5% under each scheme (if applicable).
Who it affects
Securitisation Companies (SCs), Reconstruction Companies (RCs), RBI's Department of Non-Banking Supervision
What is the minimum owned fund requirement for SCs/RCs?
The minimum owned fund must be at least 15% of total financial assets acquired or Rs.100 crore, whichever is lower, and must be maintained until assets are realized and security receipts redeemed.
When must SCs/RCs submit quarterly returns?
Quarterly statements (SCRC1 and SCRC2) must be submitted within 15 days of the close of each quarter, starting with the quarter ending March 31, 2007.
What is the deadline for commencing business after registration?
SCs/RCs must commence business within 6 months of receiving the Certificate of Registration. RBI may grant an extension, but total time cannot exceed 12 months from the date of registration.