Lok Sabha Question No. 3580 (UNSTARRED), answered on 2022-08-08
Subject: Investment in NBFCs
Ministry: FINANCE
Asked by: Queen Oja, Bharatiben Dhirubhai Shyal

## GOVERNMENT OF INDIA MINISTRY OF FINANCE

## LOK SABHA UNSTARRED QUESTION NO-† 3580

ANSWERED ON- 08/08/2022

## INVESTMENT IN NBFCs

## † 3580. SHRIMATI QUEEN OJA DR. BHARATIBEN DHIRUBHAI SHIYAL

Will the Minister of FINANCE be pleased to state:-

(a) the  details  of  the  number  of  Non-Banking  Financial  Companies  (NBFCs) operating presently in the country, State-wise;

- (b) the  details  of  the  rules  followed  during  the  registration  of  Payment  Gateway and NBFCs;
- (c) whether the Government offers any guarantee to the investments in the  said companies; and

(d) if so, the details thereof?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE

## (DR. BHAGWAT KARAD)

(a):  As  on  3.8.2022,  as  per  Reserve  Bank  of  India  (RBI)  data,  9,443  NBFCs  are registered  with  RBI.  The  number  of  registered  NBFCs  under  various  Regional Offices of RBI, along with details of the States and Union Territories over which each Regional Office has jurisdiction, is at Annex 1.

(b): As  informed  by  RBI,  Payment  Gateways  (PGs)  are  considered  'technology providers' or 'outsourcing partners' of banks or non -banks, as the case may be, and as such do not need to apply to RBI for authorisation. In case of a bank PG, as per RBI's  guidelines  on  Managing  Risks  and  Code  of  Conduct  in  Outsourcing  of Financial Services by banks dated 3.11.2006, a bank intending to outsource any of its  financial  activities  should  put  in  place  a  comprehensive  outsourcing  policy, approved by its Board, which incorporates, inter alia , criteria for selection of PGs, parameters for defining material outsourcing based on the broad criteria like the impact on the bank's reputation and brand value in case a PG fails to perform the service and the cost of outsourcing as a proportion of total operating costs of the bank  amongst  others.  Further,  NBFCs  are  granted  Certificate  of  Registration (CoR) by RBI under Section-45-IA of RBI Act., 1934. The conditions stipulated in the  said  Act  must  be  fulfilled  by  a  company  for  getting  CoR.  RBI  has  notified detailed  guidelines  on  the  process  of  registration  of  NBFCs vide its  press  release dated 17.6.2016 as per which a company seeking CoR is required to apply in the prescribed format to the RBI along with supporting documents. The RBI examines the application based on applicant company's Net Owned Fund, due diligence of its  shareholders  and  board  of  directors,  suitability  of  the  board  to  carry  out  the proposed  business,  technological  compliance  (if  applicable),  etc.  and  based  on merit, takes decision on grant of CoR to a particular applicant.

(c)  and  (d):  As  part  of  the  Aatmanirbhar  Bharat  Abhiyan,  the  Partial  Credit Guarantee  Scheme  was  introduced  on  20.5.2020  to  provide  partial  Government Guarantee against purchase of portfolio of Bonds and Commercial Papers (CPs) of NBFCs (with a rating of AA and below including unrated papers) by Public Sector Banks  (PSBs)  to  address  their  temporary  liquidity/cashflow  mismatch  and  to enable  availability  of  additional  liquidity.  The  amount  of  guarantee  under  the extended scheme was limited to first loss upto 20% of the face value at crystalized portfolio level. The portfolio to be eligible under the Scheme was to be built up by 31.12.2020. The one-time guarantee provided by the Government is co-terminus with the tenure of the instrument and can be invoked on the occurrence of default. Also, as a part of the Aatmanirbhar Bharat Abhiyan, the Government issued the Special Liquidity Scheme (SLS) on 29.5.2020 and valid upto 30.9.2020 for NBFCs to improve their liquidity position. Under the Scheme, a Special Purpose Vehicle (SPV)  viz.  SLS  Trust  was  set  up  under  SBICAP  which  issued  special  securities guaranteed  by  the  Government,  which  were  purchased  by  RBI.  The  proceeds thereof were used by the SPV to invest in CPs and Non-Convertible Debentures of NBFCs of short duration, upto 3 months with the option to rollover, as may be required. The overall guarantee was limited to Rs. 30,000 crore.

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## Lok Sabha Unstarred Parliament Question No. † 3580, for 8.8.2022

## Number of registered NBFCs under Regional Offices of RBI

| Regional Office (jurisdiction over State/ Union territory (UT))                        | Number of registered NBFCs as on 3.8.2022   |
|----------------------------------------------------------------------------------------|---------------------------------------------|
| Ahmedabad (Gujarat, and UTs of Daman and Diu, Dadra and Nagar Haveli)                  | 253                                         |
| Bangalore (Karnataka)                                                                  | 143                                         |
| Bhopal (Madhya Pradesh and Chhattisgarh)                                               | 116                                         |
| Bhubaneswar (Odisha)                                                                   | 19                                          |
| Kolkata (Sikkim, West Bengal and UT of Andaman and Nicobar Islands)                    | 4,383                                       |
| Chandigarh (Himachal Pradesh, Punjab and UT of Chandigarh)                             | 176                                         |
| Chennai (Tamil Nadu and UT of Puducherry)                                              | 332                                         |
| New Delhi (Haryana and NCT Delhi)                                                      | 1,931                                       |
| Guwahati (Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland and Tripura) | 106                                         |
| Hyderabad (Andhra Pradesh and Telangana)                                               | 149                                         |
| Jaipur (Rajasthan)                                                                     | 223                                         |
| Jammu (Jammu and Kashmir)                                                              | 27                                          |
| Kanpur (Uttar Pradesh and Uttarakhand)                                                 | 151                                         |
| Mumbai (Maharashtra and Goa)                                                           | 1,263                                       |
| Patna (Bihar and Jharkhand)                                                            | 27                                          |
| Thiruvananthapuram (Kerala and UT of Lakshadweep)                                      | 144                                         |
| Total                                                                                  | 9,443                                       |

Source: RBI

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