Synopsis: Reserve Bank of India (RBI) cancelled the Certification of Registration (CoR) of 150 Non-Banking Financial Companies (NBFCs) in May 2026, barring them from conducting NBFC business. A large number of the affected firms were concentrated in West Bengal and Delhi.
India’s financial ecosystem is mostly dependent on NBFCs to extend credit and financial services to the under-resourced segments. However, the regulatory compliance remains equal and non-negotiable for all. The RBI stated that the action was taken under Section 45-IA (6) of the Reserve Bank of India Act, 1934, and that the affected companies would no longer be permitted to do any business related to non-banking financial institutions. This action by RBI firms its commitment to maintaining the financial discipline and protecting public interest in the non-banking sector.
What are NBFCs?
A company registered under the Companies Act, 1956 or Companies Act, 2013 and is engaged in the business of loans and advances, acquisition of shares, stocks, debentures, or government securities, leasing, and other financial activities as their principal business, comes under Non-Banking Financial Company (NBFC).
Importance of Certificate of Registration (CoR)
A company can commence or carry on the business of a non-banking financial institution by obtaining a Certificate of Registration (CoR) from the Reserve Bank of India and having a Net Owned Fund (NOF) of ₹10 crore, under the Section 45-IA of the RBI Act, 1934.
Reason Behind Cancellation
- These CoRs cancellations were made due to the failure of the NBFCs (cancelled), to meet crucial regulatory and financial norms, including the non-compliance with Net Owned Fund requirements, inactivity in NBFC operations, and failure to adhere to RBI’s prudential guidelines.
- These cancellations were ordered between April 6 and April 21, 2026.
- Also another reason being, the companies exiting the NBFC, being classified as Core Investment Companies (CICs) that do not require registration.
State-wise Number of NBFCs Cancellation
The RBI cancelled registrations of 150 NBFCs, with 75 based in West Bengal, 67 in Delhi, two each from Telangana and Haryana, and one each from Madhya Pradesh, Bihar, Tamil Nadu, and Karnataka, and 7 NBFCs have voluntarily submitted their CoRs.
NBFCs which are cancelled State-wise (Selected Examples)
- West Bengal: Akin Vincom Pvt Ltd, Abir Traders Pvt Ltd, Admire Vinimay Pvt. Ltd
- Delhi: Dalmis Housing Finance Ltd, Fortune Portfolio Pvt Ltd, IND Corp Securities Ltd
- Tamil Nadu: Arulaga Roche A.C.A. Finance Private Limited
- Telangana: Basera Nirman Pvt Ltd, HBC Finance and Leasing Ltd
- Haryana: Classic Securities Pvt Ltd, IND Corp Securities Ltd
Conclusion
The RBI’s cancellation of CoRs for 150 NBFCs reflects its firm resolve to uphold the standards of the financial ecosystem of the country. This action protects depositors and investors from potential risks arising from financially unsound or inactive NBFCs. Stakeholders are advised to verify any NBFC’s registration status on the RBI’s official website before engaging in any financial transactions.
Written by Jahnavi
