Non Banking Financial Companies (NBFCs) has managed to attract a large stake of the business market in context with market encompassing the entities engaged in banking and banking-related services. It is nowadays recognized as an important segment of Indian economy. NBFCs are engaged in the business similar to a bank, but to a limited extent, it does not cover all the activities which a bank does. An NBFC offers loans, accepting deposits, giving cash advances, leasing, hiring purchase, performing financial inter-mediation etc.
India is a densely populated country hence need for money is always for survival or such other requirement is always there. Although banks are established all over India still it lacks banking institutions in many areas which has resulted in increasing demand for availing loans from NBFC and more NBFC Registration. More and more people willing to indulge in the business of NBFC in order to have a profitable business in India than ever before.
NBFC can raise funds from the public, directly or indirectly, and can freely lend them to ultimate spenders.
NBFC advance loans to the various small, wholesale, and retail traders as well as self-employed persons. NBFC advances loan at an interest which is decided by the NBFC itself, at the same time it is also known for attractive interest rates on the investors’ deposits.
NBFC has advantages in terms of short-term lending, High ROI, and No Cap on Interests.
The NBFC financial activity will not include:
Once the type of NBFC to be registered is decided then follow the given below steps, also note that the basic requirement for NBFC registration is that you should have minimum Net Owned Funds should be of ₹ Two crores to be registered as NBFC:
Note: The documents to be attached are enlisted along with the form, which can be accessed at the time of downloading the form.
It shall enclose a roadmap that the company has proper planning for having financial assets in the factoring business constituting at least 50% of its total assets and their incomes derived from factoring business will not less than 50% of its gross income for a specific time frame as mentioned.
Here’s a video about NBFC Registration Process:
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