.png "RBI Eases Rules for Small NBFCs, Grants Exemptions from July 1, 2026")
- NBFCs with an asset size below ₹1,000 crore, that do not access public funds and have no customer interface, will be exempted from certain compliance requirements.
- Specifically, exemptions apply to Section 45IA (registration requirement) and Section 45IC (reserve fund requirement) of the RBI Act, 1934.
- This means such NBFCs will no longer need to register with RBI or transfer 20% of their net profits annually into a reserve fund.
- Existing NBFCs meeting these conditions can also apply for deregistration by December 31, 2026, giving them an easier exit route.
- The RBI clarified that the ₹1,000 crore threshold is necessary to maintain oversight over systemically significant NBFCs, rejecting calls to remove this limit.
- While small NBFCs will benefit from reduced compliance costs and simplified operations, larger NBFCs will continue under full RBI regulation.
- This change has been formalized under the RBI (NBFC – Registration, Exemptions & Scale Based Regulation) Amendment Directions, 2026, reflecting the central bank’s intent to ease rules for smaller players while safeguarding financial stability.
Question:
Q.1 According to the Reserve Bank of India (RBI), Non-Banking Financial Companies (NBFCs) eligible for exemption must have an asset size below:a) ₹500 crore
b) ₹750 crore
c) ₹1,000 crore
d) ₹2,000 crore
Answer: c) The Reserve Bank of India (RBI) has fixed ₹1,000 crore as the threshold to distinguish small NBFCs from systemically important ones.
