The 16 companies in the NBFC-UL list are: LIC Housing Finance, Bajaj Finance, Mahindra & Mahindra Financial Services, Shriram Transport, Tata Sons, L&T Finance, Indiabulls Housing Finance, Piramal Capital & Housing Finance, Cholamandalam Investment and Finance Co., Shanghvi Finance Pvt. Ltd, Muthoot Finance, PNB Housing Finance, Tata Capital Financial Services, Aditya Birla Finance, HDB Financial Services and Bajaj Housing Finance.
RBI’s scale-based NBFC regulation announced in October 2021 has four layers: base layer, middle layer, upper layer and top layer. The upper layer (UL) includes NBFCs warranting enhanced regulation based on several parameters and scoring. Earlier, RBI classified NBFCs based on type.
Despite appearing in the list of top 10 NBFCs in terms of asset size, HDFC Ltd was not included in the list due to its ongoing merger process with HDFC Bank, RBI said.
These NBFCs have to put in place board-approved policies for the adoption of the enhanced regulatory framework applicable to all NBFCs in the upper layer, and chart out an implementation plan for adhering to the new set of regulations within three months, the RBI said.
Further, the boards of these NBFCs should ensure that stipulations for the NBFC-UL are adhered to within 24 months, the regulator said.
According to RBI, the aggregate exposure values of NBFC-UL to a single counterparty must not be higher than 20% and 25% in the case of group of connected counterparties.
