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RBI moots tighter control of NBFCs

The Reserve Bank of India is thinking of enforcing tougher rules for takeovers that involves NBFCs. According to draft guidelines in this regard, any purchase of 265 or more stake in a company would need RBI’s approval. This is part of the measures to bring in transparency and enforce better control over lenders other than banks, which carry out substantial amount of business in the country. There are some 12,000 NBFCs registered with the RBI, and they offer loans among other products. The draft guidelines also said the source of funds for such purchase of stake should also be revealed while the NBFCs concerned give an undertaking that the new proposed investors are not associated with any existing but unregistered body that accepts public deposits.

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