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Invitation of applications for recognition of Self-Regulatory Organisations (SROs) for NBFCs

Published on June 20, 2024
Current Context: The Reserve Bank of India (RBI) invited applications for recognition of Self-Regulatory Organizations (SROs) to oversee the non-banking financial companies (NBFCs) sector in March 2024 . A maximum of two SROs will be approved.
Invitation of applications for recognition of Self-Regulatory Organisations (SROs) for NBFCs
  • Key points about the SRO application process:
  • Membership:
    • The SRO should have a good mix of NBFC types (NBFC-ICCs, HFCs, and NBFC-Factors).
    • At least 10% of members should be smaller NBFCs categorized as NBFC-ICC and NBFC-Factor in the base layer (as per Scale Based Regulatory Framework). This membership requirement must be met within two years of recognition to avoid getting the recognition revoked.
  • Net Worth:
    • The SRO needs to have a minimum net worth of Rs 2 crore within one year of getting recognized or before starting operations, whichever is earlier.
    • This minimum net worth needs to be maintained afterwards as well.
  • Application Deadline: September 30, 2024.

Question:

1 What is the minimum net worth requirement for a Self-Regulatory Organizations (SRO) to obtain recognition from the RBI?

  • A) Rs 1 crore
  • B) Rs 2 crore
  • C) Rs 5 crore
  • D) Rs 10 crore
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