RBI Update - Reserve Bank of India (Non-Banking Financial Companies – Registration, Exemptions and Framework for Scale Based Regulation) Amendment Directions, 2026

The Reserve Bank of India (Non-Banking Financial Companies – Registration, Exemptions and Framework for Scale Based Regulation) Amendment Directions, 2026, issued by the Reserve Bank of India, introduce a revised regulatory framework for NBFCs not availing public funds and not having customer interface by formally classifying them as ‘Type I NBFCs’ and ‘Type II NBFCs’, while also defining ‘Unregistered Type I NBFCs’. The amendment provides that such NBFCs with asset size below ₹1,000 crore may be exempted from registration requirements (Sections 45IA and 45IC of the RBI Act, 1934), subject to specified conditions including absence of public funds, no customer interface, Board-approved undertakings, and mandatory disclosures; eligible existing NBFCs may apply for deregistration by December 31, 2026. It also introduces aggregation norms at the group level, clarifies indirect public funds, and mandates registration where asset size exceeds ₹1,000 crore or where business models change. Detailed procedural requirements for deregistration, auditor reporting obligations, and continued regulatory oversight have been prescribed, while ensuring that such entities remain subject to broader RBI supervisory powers. These amendments will come into effect from July 1, 2026.