RBI mandates enhanced NBFC disclosures in financial statements
Current · Source: Reserve Bank of India · RBI/2022-23/26 · issued 19 Apr 2022 · ~1 min read
Quick answerRBI has issued additional disclosure requirements for NBFCs under the Scale Based Regulation framework, effective for annual financial statements from March 31, 2023. These are in addition to existing prudential and accounting standards, with higher-layer NBFCs facing more stringent norms.
The rule, in the simplest words
All NBFCs must make additional disclosures in their financial statements, as per the Scale Based Regulation framework.
These disclosures are in addition to existing prudential and accounting standards, with higher-layer NBFCs facing more stringent norms.
NBFCs must update their financial reporting templates to include the new disclosures for annual statements from March 31, 2023.
How it plays out — a real example
An NBFC compliance officer in Indore, working for a mid-sized NBFC, ensures that their financial statements include the required disclosures, such as information on asset quality and liquidity, to provide transparency to lenders and investors. This helps the NBFC to maintain a good credit rating and attract more investors.
What changed
RBI circular DOR.ACC.REC.No.20/21.04.018/2022-23, issued April 19, 2022, introduces new disclosure requirements for NBFCs in their financial statements, as per the SBR framework. These disclosures are supplementary to existing laws and standards, and apply to all NBFCs, with specific requirements varying by layer. The guidelines take effect for annual statements ending March 31, 2023, onwards.
What it means for you
NBFCs must now incorporate additional disclosures in their notes to accounts, layered as per SBR, which could increase compliance costs and require more detailed financial reporting. Lenders and investors will gain greater transparency into NBFC financials, aiding risk assessment. Banks with NBFC exposures should monitor these disclosures for better credit evaluation.
What you must do
Review the Annex to the circular for layer-specific disclosure requirements applicable to your NBFC.
Update financial reporting templates to include the new disclosures for annual statements from March 31, 2023.
Ensure compliance teams are trained on SBR disclosure norms to avoid regulatory gaps.
Coordinate with auditors to validate that additional disclosures meet RBI standards.
Who it affects
All Non-Banking Finance Companies (NBFCs), Auditors and compliance teams of NBFCs, Banks and lenders with NBFC exposures
❓ Common questions
When do these new disclosure requirements become effective?
They are effective for annual financial statements for the year ending March 31, 2023, and onwards.
Do these disclosures replace existing requirements?
No, they are in addition to existing disclosure requirements under other laws, regulations, or accounting standards.
Are all NBFCs treated equally under this circular?
No, the Annex specifies applicability based on NBFC layers under Scale Based Regulation, with higher layers facing more requirements.
📜 Read the original circular — full text as issued by RBI
RBI/2022-23/26
DOR.ACC.REC.No.20/21.04.018/2022-23
April 19, 2022
Dear Sir/ Madam,
Disclosures in Financial Statements- Notes to Accounts of NBFCs
Please refer to our circular DOR.CRE.REC.No.60/03.10.001/2021-22 dated October 22, 2021 on ‘Scale Based Regulation (SBR): A Revised Regulatory Framework’ for NBFCs, which inter-alia envisages certain specific disclosures.
2. Non-Banking Finance Companies (NBFCs) are required to make disclosures in their financial statements in accordance with existing prudential guidelines, applicable accounting standards, laws, and regulations. The additional disclosure requirements for NBFCs in accordance with the SBR framework are outlined in the Annex .
3. These disclosures are in addition to and not in substitution of the disclosure requirements specified under other laws, regulations, or accounting and financial reporting standards. More comprehensive disclosures than the minimum required are encouraged, especially if such disclosures significantly aid in the understanding of the financial position and performance.
Applicability
4. This circular is applicable to all NBFCs. The Annex specifies the applicability of specific disclosure requirements to specific NBFC layers as per Scale Based Regulation. It may be noted that disclosure requirements applicable to lower layers of NBFCs will be applicable to NBFCs in higher layers. These guidelines shall be effective for annual financial statements for year ending March 31, 2023, and onwards.
(Usha Janakiraman)
Chief General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2022-23/26 · issued 19 Apr 2022. The plain-English explanation above is BankPulse’s own independent summary.
Example: if you are a Compliance officer at a bank this circular applies to (All Non-Banking Finance Companies (NBFCs), Auditors and compliance teams of NBFCs, Banks and lenders with NBFC exposures), your first concrete step on “RBI mandates enhanced NBFC disclosures in financial statements” is: “Review the Annex to the circular for layer-specific disclosure requirements applicable to your NBFC.” (RBI issued this 19 Apr 2022).
Action required: Review the Annex to the circular for layer-specific disclosure requirements applicable to your NBFC.
Action required: Update financial reporting templates to include the new disclosures for annual statements from March 31, 2023.
Action required: Ensure compliance teams are trained on SBR disclosure norms to avoid regulatory gaps.
Action required: Coordinate with auditors to validate that additional disclosures meet RBI standards.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.
💬 Banker Discussion
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12292&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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