RBI likely to add more NBFCs to upper layer list

The Reserve Bank of India (RBI) is likely to increase the number of non-banking financial companies (NBFCs) classified under the upper layer, which are subject to enhanced regulatory requirements, sources said.

- MANOJIT SAHA

This comes as some of these entities have grown in size and their interconnectedness with the broader financial sector has increased.

The sources added that some of big public-sector NBFCs may be added to the upper layer list. Some of them have a loan book of over ₹5 trillion. Though much less in number, such entities had a substantial share in NBFC sector’s total assets.

NBFCs of large industrial groups, Indian subsidiaries of foreign financial houses interconnected with the banking sector, housing finance subsidiaries of large NBFCs are likely to be brought under the upper layer.