NBFC Compliance in Delhi
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NBFCs of Non-Banking Financial Companies collect loans, deposits, and advances as well as shares, stocks, and other marketable securities issued by the Local Authority or Government or Local Authority. These financial companies are registered under the Companies Act, 2013. These financial Companies are not banks, although they execute lending operations on par with traditional banks. Non-Banking Financial companies must also fulfill certain compliances & file returns regularly. Failure to do NBFC Compliance can result in heavy penalties/fines & even termination of the NBFC Registration Certificate.
At present, NBFC Annual Compliance is very challenging. There was a period when banks benefited from Non-Banking Financial Firms & Compliance with Non-Banking financial companies was way easier and more permissive. Still, the Reserve Bank of India (RBI) established new NBFC Compliance guidelines. As per the Master Direction, NBFC Returns (RBI) Directions, 2016, Non-Banking Financial Companies must file different returns to the Reserve Bank of India regarding their deposit acceptance, Prudential Norms Compliance, ALM, and many more.
Now let's discuss the mandatory Annual Compliance for the NBFC:
Serial No. |
Forms |
Section and Rules |
Particular of Compliance |
Quarter- I (April to June) |
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1. |
Form MBP-1 |
184(1) |
Every Company’s Director in the 1st meeting of the BoD in each Financial Year shall disclose their interest in other entities |
Every Director of the Company is required to submit with the Company a new MBP-1 when there is a change in his or her interest from the earlier given MBP-1. |
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2. |
Form DIR-8 |
164(2), 164(3)(g) |
Every Director in each F.Y. will file with the Company disclosure of non-disqualification. |
3. |
MSME-1 |
Section 405 |
Payment Delay to the MSME Vendor – The Company has to file this return half yearly in respect of the pending payments to the vendors at the end of half a year.
|
4. |
PAS-6 (Half Yearly Return) |
Rule 9A(3) |
Reconciliation of Share Capital Audit Report. Company is required to submit the reconciliation share capital Audit report with the Registrar of Company audited by practicing CS at the end of half year. 1. Oct to Mar – 3oth May 2. Apr to Sep – 30th Nov |
Quarter – II (Jul to Sep) |
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5. |
Approval of Financial Statement (DG) |
134 |
Prep and Approval of Financial Statement. The report of Auditors shall be attached to every Financial Statement. |
6. |
Director’s Report |
134 |
Report shall be prepared by providing all the required information for the Company under Section 134 read with relevant rules & provisions of other Acts. It must be signed by the Chairperson certified by the Board, where he or she is not authorized by at least 2 Directors of the Company, one of them should be an MD if there is any. |
7. |
Holding of AGM |
96 |
Every Company should hold in addition to any other meetings each year, a General Meeting (GM) as its Annual General Meeting (AGM). It shall be held within a period of 6 months from the date of closing of F.Y. |
8. |
Notice of AGM |
101 & SS-II |
Every Notice of the AGM will be prepared as per Section 101 of the Act & SS-II. |
9. |
Sending Notice of Annual General Meeting |
101 & Secretarial Standard (SS) |
Notice of AGM will be sent to all the Directors, Members, Auditors, and Debenture Trustees (if any) |
10. |
Circulation of Financial Statements & Other Relevant Documents |
136 |
The company will send to its members the approved Financial Statement, Directors’ Report & Auditors’ Report at least 21 days before the AGM. If the Annual General Meeting is called on shorter notice then above mentioned documents shall be circulated in such a shorter period. For holding the Annual General Meeting on short notice, companies need to get the proper approvals as per the Act. |
11. |
Annual Form (DIR-3 KYC) |
Rule 12A |
KYC of the Directors, all the Directors must file this Form on or every 30th September every year. |
12. |
Annual Form: 1. AOC-4 NBFC 2. AOC-4 NBFC (INDAS) 3. AOC-4 CFS NBFC (INDAS) |
137 |
· Financial Statement: The company must file its Balance Sheet along with the P&L Account Statement, Directors & Auditors Report, and Cash Flow Statement in this Form within 30 days of holding of the AGM. · Attachment: Balance Sheet, Statement of P&L Account, Cash Flow Statement, Auditors and Directors’ Report, and an AGM Notice |
13. |
E-Forms Filing Requirements (Annual Form) |
92 |
Every Year Company will file its Annual Return within 60 days of holding the AGM. Annual Return |
14. |
Certification of Annual Return (Form MGT-8) |
92 |
A company having paid-up share capital of Rs. 10 crores or more or a turnover of Rs. 50 crores/more shall be certified by a Practicing CS. |
Quarter – IV – Jan to Mar |
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15. |
Board Meetings |
173 & SS-I |
Every Company shall hold a minimum of 4 meetings of its Board of Directors every year in such a manner that the maximum gap between the two meetings shouldn’t be more than 120 days. |
16. |
Maintenance of Statutory Registers |
88 & other Sections |
The company will maintain some Mandatory Registers like: · Registers of Members; · Registers of Director Shareholding; · Registers of Transfer; · Registers of related party transactions, etc. |
17. |
Appointment of Auditor E-Form ADT-1 |
139 |
The Auditor will be appointed for 5 years & Form ADT-1 will be filed for a 5-year appointment within 15 days of the AGM. |
Now let’s discuss NBFC Compliance as per RBI Norms:
No. |
Forms |
Applicability |
Description |
Due Date |
Monthly Compliance |
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1. |
Form DNBS-04 (Return Structural Liquidity & Interest Rate Sensitivity) |
NBFCS-NDSI & NBFCs-D |
The specifics of the mismatch in predicted future cash flows & outflows for NBFCs-NDSI are based on the maturity pattern of liabilities & assets at the end of the reporting period. |
Within 10 days of every month’s end |
2. |
CIC Reporting |
All NBFCs |
Each NBFC is required to report its loans to all 4 CICS. |
On/before the 10th day of the succeeding month |
3. |
NESL |
All NBFCs |
All NBFCs must notify NESL of not more than their financial debt. |
Not later than the 1 week after the start of the following month |
Quarterly Compliance |
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1. |
DNBS-01 Return |
NBFCS-NDSI & NBFCs-D |
The return includes financial details for NBFC-D & NBFC-NDSI comprising components of Assets & Liabilities, Profit & Loss Accounts, Exposure to Sensitive Sectors, etc. |
· 15th April · 15th July · 15th October · 15th January |
2. |
DNBS-03 Return |
NBFCS-D, NBFCS-NDSI & NBFCs Non-NDSI have more than Rs. 100 crores assets |
The return shows adherence to prudential standards, including NBFC-Deposit-Taking & NBFC-NDSI like Asset Classification & Provisioning, Capital Adequacy Asset (CAA), and NOF, etc. |
· 15th April · 15th July · 15th October · 15th January |
3. |
DNBS-04A Reply Short-Term Dynamic Liquidity (STDL) |
NBFCs-NDSI, NBFCs-D, and Non-NDSI and NBFCs with Assets of more than Rs. 100 crores |
To record specifics regarding any discrepancies b/w anticipated inflows & outflows based on future cash business projections. |
· 15th April · 15th July · 15th October · 15th January |
4. |
DNBS-06 |
RNBCS |
The return includes 15th April, and 15th July details about assets & liabilities and compliance with key prudential standards for RNBCs. |
· 15th April · 15th July · 15th October · 15th January |
5. |
Form DNBS-07 |
ARCs |
To record financial metrics & various operational details for ARCS, including assets (NPA), Acquisition Cost, Recovery Progress, etc. |
· 15th April · 15th July · 15th October · 15th January |
6. |
DNBS-08 CRILC Key Return |
NBFCs-D, NBFC-Factors, NBFCs-NDSI |
Must record credit details on exposure of more than Rs. 5 crores to a single borrower |
· 21st April · 21st July · 21st October · 21st January |
7. |
DNBS-11 |
NBFC-CICs |
The return includes financial details for CIC-ND-Sis like elements of assets & liabilities, a Profit & Loss account, exposure to sensitive industries, etc. |
· 15th April · 15th July · 15th October · 15th January |
8. |
DNBS-12 |
NBFC-CICs |
For CIC-ND-Sis, the return documents adhere to prudential standards, and 15th Jan as Asset Classification, Capital Adequacy, Provisioning, NOF, etc. |
· 15th April · 15th July · 15th October · 15th January |
9. |
DNBS-13 |
All NBFCs |
To gather data on foreign 15th April, and 15th July Investments for all NBFCs |
· 15th April · 15th July · 15th October · 15th January |
10. |
DNBS-14 |
NBFC-P2Ps |
The return consists of information regarding assets & liabilities and whether NBFCs-P2P have complied with main prudential standards. |
· 15th April · 15th July · 15th October · 15th January |
Annual Compliance |
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1. |
DNBS-02 Return |
Non-NDSI NBFCs |
This includes financial details for non-deposit, taking non-NDSI NBFCs like components of assets & liabilities and compliance with certain prudential standards. |
|
2. |
DNBS-010 |
Every NBFC & ARCs |
For all NBFCs to maintain ongoing after the day, the compliance balance of regulatory |
15 days after the day, the balance of the statement was finalized but not later than 31st Oct. |
Additional NBFC Compliance |
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1. |
DNBS-05 Return |
Rejected NBFCs |
To record details of NBFCs that accepted public deposits but whose COR is rejected. |
As when RBI rejected the COR |
2. |
DNBS-09 CRILC details |
NBFCs-D, NBFCs-NDSI, NBFC-NBFCs-D |
In SMA-2 for the day, all these NBFCs and BFC-Factors with aggregate classified exposure> Rs. 5 crores to a single classified borrower were reported. |
As soon as the account is classified (de-classified as SMA-2) |
3. |
CKYCR |
Res |
Every regulated institution including Non-Banking Financial Companies is required to do KYC when disbursing loans or establishing account relationships. |
Within 10 days of the account relationship’s start date. |
4. |
CERSAI |
All financial institutions |
At the time of disbursing secured loans |
To get 1st change of secured property asap |
5. |
FIU-IND |
All regulated entities |
All regulated organizations are required to report some transactions to the FIU-IND agency as mentioned in Rule 3, 2005 PMLA Regulations. |
Within 15 days of the month & working 7 days of being convinced that the transaction is suspicious. |
6. |
Foreign Investments |
All NBFCs |
All NBFCs must provide details on Foreign Investments by NBFCs. |
Within 15 days from the end of each quarter |
7. |
Return on FDI |
All NBFCs |
All NBFCs are required to give details of FDI by NBFCs. |
Within thirty days from the end of half year. |
At Whizseed, we know the significance of getting NBFC Compliance done. It is a vital step towards expanding your business & reaching new heights of success. Our professional experts have many years of experience & vast knowledge of the procedure involved in getting an NBFC Registration Certificate. We know all the regulations & legalities of the process, ensuring that your Registration is completed without any hassle. So, if you are looking for a reliable & experienced team to handle your NBFC Compliance, Whizseed is always there for you.