Reserve Bank of India (RBI) will simplify the registration process for non-banking finance companies (NBFCs), Deputy Governor R. Gandhi said.
“The new application forms will be simpler and the number of documents required to be submitted will be reduced. The entire process could be made online for ease, speed and transparency,” Mr. Gandhi said at a seminar organised by Assocham on Monday.
RBI resumed issuing licences to NBFCs last year.
Mr. Gandhi said the NBFC sector cannot be on a par with the banking sector and the central bank’s stance was to “harmonise, not equalise.”
Totally exempting small NBFCs from regulations may not be feasiblefrom the customer service point of view, he said.
“The rule that we prescribe for a bank cannot apply exactly to NBFCs. Harmonising means to remove the arbitrage. ,” he said.
He added that ‘Make in India’ and ‘Start Up’ businesses could offer fresh opportunities to NBFCs for growth.
The deputy governor also said the central bank would come out with a discussion paper on peer-to-peer lending (P2P). P2P is where consumers lend and borrow from each other with the help of an intermediary.“We are going to come up with a discussion paper because it (P2P lending) is a new development. We will have to take feedback from all stakeholders. We will discuss about the pros and cons, whether we should be regulating or not. Based on the feedback we will take the final call,” Mr. Gandhi said.
Securities and Exchange Board of India (SEBI) had come up with a discussion paper exploring the securities aspect of the business. However, RBI is yet to come up with its own discussion paper from the lending and borrowing side.
The banking regulator will consult SEBI before finalising the norms.
