Starting a Non-Banking Financial Company (NBFC) in India offers a promising opportunity in the financial services sector. However, entrepreneurs often get overwhelmed by the compliance requirements, particularly regarding the cost and timeline involved in NBFC Registration in India. In this blog, we break down everything you need to know about the cost, timeline, and process for obtaining an NBFC License in India.
Understanding NBFC Registration in India
An NBFC is a financial institution that provides banking services without holding a banking license. It can offer loans, credit facilities, retirement planning, and investment advisory. However, NBFCs cannot accept demand deposits or issue cheques drawn on themselves.
To begin operations, an NBFC must obtain an NBFC license from RBI in India, which involves several legal, financial, and regulatory steps. Fortunately, the process of NBFC registration online in India has made things more streamlined and accessible.
Cost of NBFC Registration in India
The NBFC Registration cost in India can vary depending on multiple factors such as the type of NBFC (loan company, investment company, microfinance, etc.), professional consultant fees, and compliance requirements. Here’s a general breakdown:
1. Minimum Net Owned Fund (NOF) Requirement
- The applicant company must have a minimum NOF of ₹2 crore.
- For Microfinance NBFCs, the minimum NOF is ₹5 crore (₹2 crore for North-Eastern states).
2. Professional Fees
- Hiring an NBFC Registration Consultant in India is advisable for end-to-end guidance.
- Consultant fees can range from ₹2,00,000 to ₹5,00,000 depending on the services (business plan, documentation, compliance, etc.).
3. Government and Filing Fees
- Digital Signature Certificate (DSC) – ₹2,000–₹3,000
- Director Identification Number (DIN) – ₹500 per director
- MCA Filing, MOA, AOA – ₹5,000–₹10,000
- RBI Application Processing Fee – Nil (but consultant or legal assistance will cost additionally)
Total Estimated Cost: ₹3 lakh to ₹6 lakh (excluding NOF capital)
Timeline for NBFC License in India
The timeline for online NBFC registration in India depends on document readiness, due diligence by RBI, and business category. Here’s an estimated timeline:
1. Company Incorporation: 1–2 Weeks
- Register a Private Limited or Public Limited company with a financial activity object clause.
2. Document Preparation: 2–3 Weeks
- Business plan, KYC documents, net worth certificate, banker’s report, and other documents are prepared for submission.
3. Application Submission to RBI: 1 Week
- Submit the application on the RBI COSMOS Portal for NBFC license online.
4. RBI Review & Approval: 3–6 Months
- RBI conducts background verification, checks financial health, and may request additional documents or clarification.
Total Estimated Timeline: 4 to 7 months
Steps for Online NBFC Registration in India
- Choose the NBFC type
- Incorporate the company
- Open a bank account and deposit ₹2 crore NOF
- Hire an experienced NBFC registration consultant
- Prepare and submit the application to RBI
- Respond to RBI queries, if any
- Receive Certificate of Registration (CoR)
With a reliable NBFC registration consultant in India, you can fast-track the process and ensure compliance at every step.
Why Hire an NBFC Registration Consultant?
Hiring a professional NBFC registration consultant ensures:
- Proper documentation
- Timely application filing
- Business model compliance with RBI norms
- Lower risk of application rejection
They can also guide you with NBFC license online renewal, changes in company structure, or business expansion.
Final Thoughts
While the NBFC Registration in India requires significant capital and patience, the long-term returns are promising. Whether you’re applying for an NBFC license in India for lending, investment, or microfinance, understanding the cost and timeline is crucial for informed decision-making.
Opt for a reliable NBFC registration consultant in India to avoid delays and ensure RBI approval on the first go. The opportunity to provide financial services in a growing economy like India is worth the effort.