What changed
RBI issued a master circular consolidating all existing directions for SCs/RCs into a single document. Key updates include the requirement for SCs/RCs to maintain minimum owned fund of not less than 15% of total financial assets acquired or to be acquired or ₹100 crore, whichever is lower, and to commence business within six months from the date of grant of Certificate of Registration (extendable up to 12 months). Quarterly statements (SCRC1 & SCRC2) must be submitted within 15 days of quarter-end, and audited balance sheets within one month of the AGM.
What it means for you
Banks and lenders dealing with SCs/RCs now have a single reference for compliance requirements, reducing ambiguity. The minimum owned fund rule ensures SCs/RCs have skin in the game, protecting asset quality. Timely reporting obligations mean banks must coordinate with SCs/RCs to ensure data accuracy and avoid regulatory lapses.
What you must do
- Verify that SCs/RCs you work with maintain minimum owned fund of 15% of assets or ₹100 crore, whichever is lower.
- Ensure SCs/RCs submit quarterly SCRC1 and SCRC2 statements within 15 days of quarter-end.
- Confirm SCs/RCs commence business within 6 months of registration (max 12 months with RBI extension).
- Review audited balance sheets of SCs/RCs within one month of their AGM for compliance.
Who it affects
Securitisation Companies (SCs), Reconstruction Companies (RCs), Banks and financial institutions dealing with SCs/RCs, RBI's Department of Non-Banking Supervision
What is the minimum owned fund requirement for SCs/RCs?
SCs/RCs must maintain owned fund of at least 15% of total financial assets acquired or to be acquired, or ₹100 crore, whichever is lower, until asset realization and redemption of security receipts.
How soon must an SC/RC start business after registration?
Business must commence within six months of receiving the Certificate of Registration, extendable by RBI up to a maximum of 12 months.
What quarterly reports must SCs/RCs submit?
SCs/RCs must submit quarterly statements SCRC1 and SCRC2 on assets acquired, securitized, and reconstructed within 15 days of the quarter's end.