Mumbai: Having revised regulations for non-banking finance lenders, the Reserve Bank directed them to get themselves rated by March 2016, and those failing to achieve investment grade ratings should not accept fresh deposits or renew older ones.
In the revised regulatory framework on NBFCs notified late this evening, it said, “Those asset finance companies (AFCs) that do not get a minimum investment grade rating by the end of March 2016, shall not renew existing deposits or accept fresh deposits thereafter.” Till March 2016, unrated companies or those with a sub-investment grade, have been allowed to only renew existing deposits on maturity, but barred from accepting fresh deposits.
RBI said if a company’s rating is downgraded, an NBFC should regularise the excess deposit with immediate effect, stop accepting fresh public deposits and renewing existing deposits. It can be noted that the Reserve Bank had come out with a new regulatory framework for NBFCs last November, in which it insisted on having a much stronger capital base, failing which they would lose their registration.
