NBFC due diligence examines financial, credit, legal and regulatory information relevant to an investment, acquisition or lending decision.
Understanding NBFC Due Diligence
When to consider this service
Promoters, regulated businesses and compliance leaders assessing an activity-specific regulatory requirement can use this service to clarify a particular issue. A useful starting question is: “Does a current NBFC registration remove the need for diligence?” Begin with the facts behind that question rather than assuming that a standard package will resolve it.
Scope of work
The engagement can cover the following workstreams. The proposal specifies which apply to your matter and what evidence or specialist input is needed.
- Review registration governance and regulatory history.
- Assess loan quality liabilities and financial records.
- Prioritise transaction risks and closing actions.
Documents and information to prepare
Start with the records below where available. They help establish the facts before a more specific checklist is agreed.
- Loan data.
- Financial statements.
- Licences.
- Regulatory correspondence.
Provide the relevant entity, transaction or reporting period and any existing notice or deadline. Identify missing or inconsistent records so they can be addressed explicitly.
A key issue to resolve
A valid registration certificate does not confirm the quality of the loan book or the absence of historical liabilities.
How the engagement works
- Define the question: review registration governance and regulatory history, using the available loan data and the facts you provide.
- Examine the evidence: assess loan quality liabilities and financial records. Record unresolved information and the assumptions that affect the analysis.
- Agree the action: prioritise transaction risks and closing actions. Set the required deliverables, responsible owners and any follow-up or external dependency.
Deliverables, fees and timing
The proposal for NBFC Due Diligence sets out the analysis, documentation or coordination deliverables and the work you retain. The availability of loan data, financial statements, licences and regulatory correspondence affects readiness and the amount of follow-up needed. Fees and the working schedule are agreed after that initial assessment. Any required independent report, legal representation or authority application is identified as a separate responsibility where relevant.
Official resources
Use these official resources for the relevant framework. Application to a particular entity, period or jurisdiction requires a separate assessment.
Discuss your requirement
Share a short summary of your NBFC Due Diligence requirement and the records already available. BIATConsultant can assess the proposed scope and explain the next steps.
FAQ
Practical questions about NBFC Due Diligence.
Does a current NBFC registration remove the need for diligence?
A valid registration certificate does not confirm the quality of the loan book or the absence of historical liabilities.
What records should I prepare for NBFC Due Diligence?
What can the scope of NBFC Due Diligence include?
How are fees and the schedule agreed?