India's RBI amends NBFC branch rules with NOF and rating gates
→Deposit-taking NBFCs must apply NOF and AA gates before expansion
Change
India's RBI amended NBFC branch authorisation rules, making deposit-taking NBFC branch expansion depend on net owned fund and credit-rating thresholds.
Why it matters
The amendment takes effect immediately. Deposit-taking NBFCs with NOF up to Rs 50 crore can open branches only in their home state. India-wide expansion requires NOF above Rs 50 crore and an AA-or-above rating.
Implications
- — Branch-expansion teams must block out-of-state openings unless NOF exceeds Rs 50 crore and rating is AA-or-above - non-compliant expansion breaches RBI directions.
- — Legal and compliance teams must update branch-approval policies now - missing NOF and rating gates create regulatory non-compliance exposure.
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Source
View on RBI