Master Directions

RBI/DOR/2025-26/346
DOR.FIN.REC.No.265/03.10.119/2025-26

November 28, 2025

Reserve Bank of India (Non-Banking Financial Companies - Acceptance of Public Deposits) Directions, 2025

In exercise of the powers conferred under sections 45J, 45JA, 45K, 45L and 45MA of the Reserve Bank of India Act, 1934 (Act 2 of 1934), sections 30, 30A, 32 and 33 of the National Housing Bank Act, 1987 (Act 53 of 1987) and of all the powers enabling it in this behalf, the Reserve Bank of India being satisfied that it is necessary and expedient in the public interest so to do, hereby, issues the Directions hereinafter specified.

Chapter-I Preliminary

A. Short Title and Commencement

1. These Directions shall be called the Reserve Bank of India (Non-Banking Financial Companies - Acceptance of Public Deposits) Directions, 2025.

2. These Directions shall become effective on the day these are placed on the official website of the Reserve Bank.

B. Applicability

3. The applicability of these Directions shall be as follows:

(1) These Directions shall be applicable to the following Non-Banking Financial Companies (hereinafter collectively referred to as ‘NBFCs’ and individually as an ‘NBFC’):

(i) NBFC-D registered with the RBI under the provisions of the RBI Act, 1934.

(ii) Deposit taking HFC registered with the RBI under the provisions of the NHB Act, 1987.

Provided that Paragraphs 10, 11, 30, 40, 50 to 52, 62 and 63 shall not be applicable to deposit taking HFC. The deposit taking HFC may be guided by the provisions contained in Chapter VI of Reserve Bank of India (Housing Finance Company) Directions, 2025.

Provided further that necessary reporting prescribed in these Directions to Supervisors shall be done to respective Supervisors by deposit taking HFC.

(iii) NBFC being a Government company as defined under clause (45) of section 2 of the Companies Act, 2013.

(2) These Directions shall not be applicable to the following:

(i) A Mutual Benefit Financial Company or a Mutual Benefit Company.

Provided that the application of Mutual Benefit Company is not rejected by Government of India under the provisions of the Companies Act, 1956 (Act 1 of 1956).

(ii) An insurance company holding a valid certificate of registration issued under section 3 of the Insurance Act, 1938 (Act 4 of 1938), or a stock exchange notified under section 4 of the Securities Contracts (Regulation) Act, 1956 (Act 42 of 1956), or a stock broking company defined in section 12 of the Securities and Exchange Board of India Act, 1992 (Act 15 of 1992);

(iii) An NBFC not accepting / holding any public deposit:

Provided that the company shall pass in the meeting of its board of directors within thirty days of the commencement of the next financial year and each subsequent financial year, a resolution to the effect that the company has neither accepted public deposit nor would accept any public deposit during the year.

(iv) An HFC not accepting / holding any public deposit:

Provided that the company shall pass in the meeting of its board of directors within thirty days of the commencement of the next financial year and each subsequent financial year, a resolution to the effect that the company has neither accepted public deposit nor would accept any public deposit during the year.

(v) A company,

(a) which has acquired shares / securities of its own group / holding / subsidiary companies only and such acquisition is not less than 90 per cent of its total assets at any point of time;

(b) which does not trade in such shares / securities; and

(c) which does not accept / hold any public deposit;

Provided that the company passes in the meeting of its board of directors within thirty days of the commencement of each subsequent financial year a resolution to the effect that the company has invested or would invest / hold its investments in the shares / securities of its group / holding / subsidiary companies of not less than 90 per cent of its assets and (name of each company to be specified), that it would not trade in such shares / securities and that it has neither accepted nor would accept any public deposit during the year.

4. The Reserve Bank may, if it considers necessary for avoiding any hardship or for any other just and sufficient reason, grant extension of time to comply with or exempt any company or class of companies from all or any of the provisions of these Directions either generally or for any specified period subject to such conditions as the Reserve Bank may impose.

5. These Directions consolidate the regulations as issued by Department of Regulation, Reserve Bank of India. However, any other Directions / guidelines issued by any other Department of the Reserve Bank, as applicable to a Deposit taking NBFC shall be adhered to, by it.

6. Deposit taking NBFCs intending to offer green deposits to their customers shall comply with the Reserve Bank of India (Non-Banking Financial Companies – Climate Finance and Management of Climate Change Risks) Directions, 2025 , as amended from time to time.

C. Definitions

7. For the purpose of these Directions, unless the context otherwise requires:

(1) ‘depositor’ means any person who has made a deposit with a company; or an heir, legal representative, administrator or assignee of the depositor.

(2) ‘deposit taking HFC’ means a Housing Finance Company which has been granted registration by the Reserve Bank to accept public deposits.

(3) ‘deposit taking NBFC’ (NBFC-D) means an NBFC which has been granted registration by the Reserve Bank to accept public deposits.

(4) ‘free reserves’ means the aggregate of the balance in the share premium account, capital and debenture redemption reserves and any other reserve shown or published in the balance sheet of a company and created through an allocation of profits not being a reserve created for repayment of any future liability or for depreciation in assets or for bad debts or a reserve created by revaluation of the assets of the company.

(5) ‘hybrid debt' shall have the same meaning as defined in the Reserve Bank of India (Non-Banking Financial Companies – Prudential Norms on Capital Adequacy) Directions, 2025;

(6) ‘insurance company’ means any company registered under section 3 of the Insurance Act, 1938 (Act 4 of 1938).

(7) ‘Investment and Credit Company' shall have the same meaning as assigned to the term 'NBFC-ICC' in the Reserve Bank of India (Non-Banking Financial Companies – Registration, Exemptions and Framework for Scale Based Regulation) Directions, 2025.

(8) ‘lending public financial institution’ means –

(i) a public financial institution specified in or under section 4A of the Companies Act, 1956; or

(ii) a State Financial, Industrial or Investment Corporation; or

(iii) a scheduled commercial bank; or

(iv) the General Insurance Corporation of India established in pursuance of the provisions of section 9 of the General Insurance Business (Nationalisation) Act, 1972 (Act 57 of 1972); or

(v) any other institution which the Reserve Bank may, by notification, specify in this behalf.

(9) ‘mutual benefit financial company’ means any company which is a financial institution notified by the Central Government under section 620A of the Companies Act, 1956;

(10) ‘mutual benefit company’ means a company not notified under section 620A of the Companies Act, 1956 and carrying on the business of a non-banking financial institution, -

(i) on 9th January 1997; and

(ii) having the aggregate of net owned funds and preferential share capital of not less than ten lakhs of rupees; and

(iii) has applied for issue of certificate of registration to the Reserve Bank on or before 9th July 1997; and

(iv) is complying with the requirements contained in the relevant provisions of the Directions issued under section 637A of the Companies Act, 1956 applicable to Nidhi Companies by the Central Government.

(11) ‘net owned fund’ refers to the net owned fund (NOF) as defined under section 45-IA of the RBI Act, 1934 including the paid up preference shares which are compulsorily convertible into equity.

(12) ‘non-banking financial company’ (NBFC), for the purpose of these Directions, means only the non-banking institution which is an investment and credit company or Housing Finance Company or a mutual benefit financial company or a factor registered with the Reserve Bank under section 3 of Factoring Regulation Act (2011).

(13) problem NBFC means an NBFC- -

(i) has refused or failed to meet within five working days any lawful demand for repayment of the matured public deposits; or

(ii) intimates the Company Law Board / NCLT under section 58AA of the Companies Act, 1956 or the corresponding provision of Companies Act, 2013, about its default to a small depositor in repayment of any public deposit or part thereof or any interest thereupon; or

(iii) approaches the Reserve Bank for withdrawal of the liquid asset securities to meet its deposit obligations; or

(iv) approaches the Reserve Bank for any relief or relaxation or exemption from the provisions of these Directions or from that of any other Directions applicable to a non-banking financial company for avoiding default in meeting public deposit or other obligations; or

(v) has been identified by the Reserve Bank to be a problem NBFC either suo moto or based on the complaints from the depositors about non-repayment of public deposits or on complaints from the company’s lenders about non-payment of dues.

(14) ‘public deposit’ means a deposit as defined under section 45-I(bb) of the RBI Act, 1934, excluding the following:

(i) any amount received from the Central Government or a State Government or any amount received from any other source and whose repayment is guaranteed by the Central Government or a State Government or any amount received from a local authority or a foreign Government or any other foreign citizen, authority or person;

(ii) any amount received from the Industrial Development Bank of India established under the Industrial Development Bank of India Act, 1964 (Act 18 of 1964), or the Life Insurance Corporation of India established under the Life Insurance Corporation Act, 1956 (Act 31 of 1956), or the General Insurance Corporation of India and its subsidiaries established in pursuance of the provisions of section 9 of the General Insurance Business (Nationalisation) Act, 1972 (Act 57 of 1972), or the Small Industries Development Bank of India established under the Small Industries Development Bank of India Act, 1989 (Act 39 of 1989), or the Unit Trust of India established under the Unit Trust of India Act, 1963 (Act 52 of 1963), or National Bank for Agriculture and Rural Development established under the National Bank for Agriculture and Rural Development Act, 1982, or an Electricity Board constituted under the Electricity (Supply) Act, 1948, or the Tamil Nadu Industrial Investment Corporation Ltd., or the National Industrial Development Corporation of India Ltd., or the Rehabilitation Industries Corporation of India Ltd., or the Industrial Credit & Investment Corporation of India Ltd., or the Industrial Finance Corporation of India Ltd., or the Industrial Investment Bank of India Ltd., or the State Trading Corporation of India Ltd., or the Rural Electrification Corporation Ltd., or the Minerals and Metals Trading Corporation of India Ltd., or the Agricultural Finance Corporation Ltd., or the State Industrial and Investment Corporation of Maharashtra Ltd., or the Gujarat Industrial Investment Corporation Ltd., or Asian Development Bank or International Finance Corporation or a company incorporated under the Companies Act, 1956; or a Corporation established by or under any Statute; or a cooperative society registered under the Cooperative Societies Act of any State and any other institution that may be specified by the Reserve Bank in this behalf;

(iii) any amount received by a company from any other company;

(iv) any amount received and held pursuant to an offer made in accordance with the provisions of the Companies Act, 2013, towards subscription to any securities, including share application money or advance towards allotment of securities pending allotment, to such extent and for such period as permissible under the Companies (Acceptance of Deposit) Rules, 2014 and as amended from time to time;

(v) any amount received from a person who at the time of receipt of the amount was a director of the company or any amount received from its shareholders by a private company or by a private company which has become a public company under section 43A of the Companies Act, 1956 and continues to include in its Articles of Association provisions relating to the matters specified in clause (iii) of sub-section (1) of section 3 of the Companies Act, 1956:

Provided that the director or shareholder, as the case may be, from whom the money is received furnishes to the company at the time of giving the money, a declaration in writing to the effect that the amount is not being given out of funds acquired by him by borrowing or accepting from others;

Provided further that in the case of joint shareholders of a private company, monies received from or in the name of the joint shareholders except the first named shareholder shall not be eligible to be treated as the receipt of money from the shareholder of the company;

(vi) any amount raised by the issue of bonds or debentures secured by the mortgage of any immovable property of the company; or by any other asset or which would be compulsorily convertible into equity in the company provided that in the case of such bonds or debentures secured by the mortgage of any immovable property or secured by other assets, the amount of such bonds or debentures shall not exceed the market value of such immovable property / other assets;

(vii) any amount raised by issuance of non-convertible debentures with a maturity more than one year and having the minimum subscription per investor at ₹ one crore and above, provided that such debentures have been issued in accordance with the guidelines issued by the Reserve Bank as in force from time to time in respect of such non-convertible debentures.

(viii) any amount brought in by the promoters by way of unsecured loan in pursuance of stipulations of lending institutions subject to the fulfilment of the following conditions, namely:-

(a) the loan is brought in pursuance of the stipulation imposed by the lending public financial institution in fulfilment of the obligation of the promoters to contribute such finance,

(b) the loan is provided by the promoters themselves and/or by their relatives, and not from their friends and business associates, and

(c) the exemption under this sub-clause shall be available only till the loan of financial institution is repaid and not thereafter;

(ix) any amount received from a Mutual Fund which is governed by the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996;

(x) any amount received as hybrid debt or subordinated debt the minimum maturity period of which is not less than sixty months provided there is no option for recall by the issuer within the period;

(xi) any amount received from a relative of a director of the NBFC.

Note: The deposit shall be accepted only on an application made by the depositor containing therein that as on the date of deposit, he is related to the specific director in the capacity of a relative as defined under Companies Act, 1956 or Companies Act, 2013;

(xii) any amount received by issuance of commercial paper, in accordance with Master Direction – Reserve Bank of India (Commercial Paper and Non-Convertible Debentures of original or initial maturity up to one year) Directions, 2024;

(xiii) any amount received by a NBFC-Middle Layer and above (except deposit taking NBFCs) by issuance of 'perpetual debt instruments' in accordance with guidelines issued in this regard by the Reserve Bank and as amended from time to time;

Explanation: NBFC-Middle Layer has been defined in Reserve Bank of India (Non-Banking Financial Companies – Registration, Exemptions and Framework for Scale Based Regulation) Directions, 2025.

(xiv) any amount raised by the issue of infrastructure bonds by an Infrastructure Finance Company, as specified in the notification issued from time to time by the Central Government under section 80CCF of the Income Tax Act, 1961;

(xv) any amount received by an HFC from NHB or any Public Housing Agency.

(15) ‘securities’ means securities as defined in section 2(h) of the Securities Contracts (Regulation) Act, 1956 (Act 42 of 1956).

(16) ‘subordinated debt' shall have the same meaning as defined and accorded treatment in the Reserve Bank of India (Non-Banking Financial Companies – Prudential Norms on Capital Adequacy) Directions, 2025.

(17) ‘stock broking company’ means a company doing the business of a stock-broker or sub-broker holding a valid certificate of registration obtained under section 12 of the Securities and Exchange Board of India Act, 1992 (Act 15 of 1992);

(18) ‘stock exchange’ means a company recognised as a stock exchange under section 4 of the Securities Contracts (Regulation) Act, 1956 (Act 42 of 1956).

(19) ‘tiny deposit’ means the aggregate amount of public deposits not exceeding ₹10,000/- standing in the name of the sole or the first named depositor in the same capacity in all the branches of the NBFC.

8. Words or expressions used in these Directions but not defined herein and defined in the RBI Act, 1934 shall have the same meaning as assigned to them in the RBI Act, 1934. Any other words or expressions used in these Directions and not defined in these Directions or in the RBI Act, 1934 or any of the Directions issued by the Reserve Bank, shall have the meanings respectively assigned to them under the Companies Act, 1956 or Companies Act, 2013 as the case may be.

9. (1) If any question arises as to whether a company is a financial institution or not, such question shall be decided by the Reserve Bank in consultation with the Central Government and the decision of the Reserve Bank shall be final and binding on all the parties concerned.

(2) If any question arises as to whether a company, which is a financial institution, is an Investment and Credit Company; such question shall be decided by the Reserve Bank, having regard to the principal business of the company and other relevant factors and the decision of the Reserve Bank shall be final and binding on all the parties concerned.

Chapter-II Requirement of Maintenance of Liquid Assets

10. Every NBFC-D, shall invest and continue to invest in India in unencumbered approved securities valued at the price not exceeding the current market price of such securities an amount which shall, at the close of business on any day, not be less than 15 per cent of the ‘public deposit’, as defined under paragraph 7(14) of these Directions, outstanding at the close of business on the last working day of second preceding quarter; and

11. All other provisions of section 45-IB of the RBI Act, 1934 shall mutatis-mutandis be applicable to the above requirement as if the expression ‘public deposit’ is the same as the expression ‘deposit’ as contemplated under the said provision.

Provided that such NBFCs shall be entitled to invest an amount equal to or in excess of ten per cent of public deposits, in unencumbered approved securities and the remaining in unencumbered

(1) term deposits in any scheduled commercial bank, Small Industries Development Bank of India (SIDBI) or National Bank for Agriculture and Rural Development (NABARD) or

(2) bonds issued by SIDBI or NABARD.

Provided further that, the aggregate of the amount invested in unencumbered approved securities, term deposits and the bonds as aforesaid shall not be less than 15 per cent of public deposits.

Chapter-III Restriction on Acceptance of Public Deposit by NBFC

A. Minimum Credit Rating

12. No NBFC shall accept public deposit unless it has obtained minimum investment grade for fixed deposits from any one of the approved credit rating agencies at least once a year and a copy of the rating is sent to the Reserve Bank along with return on prudential norms.

13. In the event of upgrading or downgrading of credit rating of any NBFC to any level from the level previously held by the NBFC, it shall within fifteen working days of its being so rated inform the Reserve Bank in writing, of such upgrading / downgrading.

B. Approved Credit Rating Agencies and Minimum Investment Grade Credit Rating

14. The minimum investment grade credit rating shall be ‘BBB-’ from any of the SEBI-registered Credit Rating Agencies.

C. Prohibition from Accepting Demand Deposit:

15. No NBFC shall accept any public deposit which is repayable on demand.

D. Period of Public Deposit

16. No NBFC shall accept or renew any public deposit, unless such deposit is repayable after a period of twelve months but not later than sixty months from the date of acceptance or renewal thereof.

E. Ceiling on Quantum of Deposit:

17. An NBFC

(1) having minimum NOF as stipulated by the Reserve Bank, and

(2) complying with all the prudential norms,

shall accept or renew public deposit, together with the amounts remaining outstanding in the books of the company as on the date of acceptance or renewal of such deposit, not exceeding one and one-half times of its NOF.

Provided that an NBFC holding public deposits in excess of the limit of one and one-half times of its NOF shall not renew or accept fresh deposits till such time it reaches the revised limit.

Provided further that no matured public deposit shall be renewed without the express and voluntary consent of the depositor.

F. Downgrading of Credit Rating

18. In the event of downgrading of credit rating below the minimum specified investment grade as provided for in paragraph 15 above, an NBFC, shall regularise the excess deposit as provided hereunder;

(1) with immediate effect, stop accepting fresh public deposits and renewing existing deposits;

(2) all existing deposits shall run off to maturity; and

(3) report the position within fifteen working days, to the concerned Regional Office of the Reserve Bank where the NBFC is registered.

G. Ceiling on the rate of interest

19. No NBFC shall invite or accept or renew public deposit at a rate of interest exceeding twelve and half per cent per annum. Interest may be paid or compounded at rests which shall not be shorter than monthly rests.

H. Deposits from Non-Resident Indians

20. No NBFC shall invite or accept or renew deposits from Non-Resident Indians/ persons of Indian origin, unless it is in compliance with regulations prescribed vide Foreign Exchange Management (Deposit) Regulations, 2016 (as amended from time to time) and such deposits shall not be at a rate exceeding the rate specified by the Reserve Bank for such deposits with scheduled commercial banks.

Explanation - The period of above deposits shall be not less than one year and not more than three years.

I. Payment of Brokerage

21. No NBFC shall pay to any broker on public deposit collected by or through him, -

(1) brokerage, commission, incentive or any other benefit by whatever name called, in excess of two per cent of the deposit so collected; and

(2) expenses by way of reimbursement on the basis of relative vouchers/bills produced by him, in excess of 0.5 per cent of the deposit so collected.

J. Intimation of Maturity of Deposits to Depositors

22. It shall be the obligation of the NBFC to intimate the details of maturity of the deposit to the depositor at least 14 days before the date of maturity of the deposit.

K. Renewal of public deposit

23. Where an NBFC permits an existing depositor to renew the deposit before maturity for availing of the benefit of higher rate of interest, such company shall pay the depositor the increase in the rate of interest provided that, -

(1) the deposit is renewed in accordance with the other provisions of these Directions and for a period longer than the remaining period of the original contract; and

(2) the interest on the expired period of the deposit is reduced by one percentage point from the rate which the company would have ordinarily paid, had the deposit been accepted for the period for which such deposit had run; any interest paid earlier in excess of such reduced rate is recovered/adjusted.

L. Payment of interest on overdue public deposits

24. An NBFC may, at its discretion, allow interest on an overdue public deposit or a portion of the said overdue deposit from the date of maturity of the deposit subject to the conditions that:

(1) the total amount of overdue deposit or the part thereof is renewed in accordance with other relevant provisions of these Directions, from the date of its maturity till some future date; and

(2) the interest allowed shall be at the appropriate rate operative on the date of maturity of such overdue deposit which shall be payable only on the amount of deposit so renewed:

Provided that where an NBFC fails to repay the deposit along with interest on maturity on the claim made by the depositor, the NBFC shall be liable to pay interest from the date of claim till the date of repayment at the rate as applicable to the deposit.

25. In regard to the payment of interest on such deposit which have either been seized by the government authorities, and / or have been frozen till further clearance is received by the concerned Government authorities, the NBFCs shall follow the procedure mentioned below:

(1) A request letter shall be obtained from the depositor on maturity. While obtaining the request letter from the depositor for renewal, NBFCs shall also advise the depositor to indicate the term for which the deposit is to be renewed. In case the depositor does not exercise his option of choosing the term for renewal, NBFCs shall renew the same for a term equal to the original term.

(2) No new receipt shall be issued. However, suitable note shall be made regarding renewal in the deposit ledger.

(3) Renewal of deposit shall be advised by registered letter / speed post / courier service to the concerned Government department under advice to the depositor. In the advice to the depositor, the rate of interest at which the deposit is renewed shall also be mentioned.

(4) If overdue period does not exceed 14 days on the date of receipt of the request letter, renewal shall be done from the date of maturity. If it exceeds 14 days, NBFCs shall pay interest for the overdue period as per the policy adopted by them, and keep it in a separate interest free sub-account which shall be released when the original fixed deposit is released.

26. However, the final repayment of the principal and the interest so accrued shall be done only after the clearance regarding the same is obtained by the NBFCs from the respective Government agencies.

M. Joint deposit

27. Where so desired, deposits may be accepted in joint names with or without any of the clauses, namely, ‘Either or Survivor’, ‘Number One or Survivor/s’, ‘Anyone or Survivor/s’.

N. Particulars to be specified in application form soliciting public deposits

28. No NBFC shall accept or renew any public deposit except on a written application from the depositor in the form to be supplied by the company, which form shall contain all the particulars specified in the Non-Banking Financial Companies and Miscellaneous Non-Banking Companies (Advertisement) Rules, 1977, made under section 58A of the Companies Act, 1956 and also contain the specific category of the depositor, i.e., whether the depositor is a shareholder or a director or a promoter of the company or a member of public.

29. The application form shall also contain the following:

(1) the credit rating assigned for its fixed deposit and the name of the credit rating agency which rated the company

(2) clause to the effect that in case of non-repayment of the deposit or part thereof as per the terms and conditions of such deposit, the depositor may approach the Eastern / Western / Northern / Southern (delete which are inapplicable) Bench of Company Law Board or NCLT whose full address is given hereunder:

(3) clause to the effect that in case of any deficiency of the company in servicing its deposit, the depositor may approach the National Consumers Disputes Redressal Forum, the State Level Consumers Disputes Redressal Forum or the District Level Consumers Disputes Redressal Forum for relief;

(4) a statement that the financial position of the company as disclosed and the representations made in the application form are true and correct and that the company and its Board of Directors are responsible for the correctness and veracity thereof;

(5) a statement to the effect that the financial activities of the company are regulated by the Reserve Bank. It must, however, be distinctly understood that the Reserve Bank does not undertake any responsibility for the financial soundness of the company or for the correctness of any of the statements or the representations made or opinions expressed by the company; and for repayment of deposit / discharge of liabilities by the company;

(6) at the end of application form but before the signature of the depositor, the following verification clause by the depositor shall be appended: ‘I have gone through the financials and other statements / particulars / representations furnished / made by the company and after careful consideration I am making the deposit with the company at my own risk and volition’;

(7) the information relating to and the aggregate dues from the facilities, both fund and non-fund based, extended to, and the aggregate dues from companies in the same group or other entities or business ventures in which the directors and / or the NBFC are holding substantial interest and the total amount of exposure to such entities.

30. Every NBFC shall obtain proper introduction of the new depositors before opening their accounts and accepting the deposits and keep on its record the evidence which it has relied upon for the purpose of such introduction.

O. Advertisement and statement in lieu of advertisement:

31. Every NBFC soliciting public deposits shall comply with the provisions of the Non-Banking Financial Companies and Miscellaneous Non-Banking Companies (Advertisement) Rules, 1977 and shall also specify in every advertisement to be issued thereunder, the following:

(1) the actual rate of return by way of interest, premium, bonus, other advantage to the depositor;

(2) the mode of repayment of deposit;

(3) the maturity period of deposit;

(4) the interest payable on deposit;

(5) the rate of interest which will be payable to the depositor in case the depositor withdraws the deposit prematurely;

(6) the terms and conditions subject to which a deposit will be renewed;

(7) any other special features relating to the terms and conditions subject to which the deposit is accepted/renewed;

(8) the information, relating to the aggregate dues (including the non-fund based facilities provided to) from companies in the same group or other entities or business ventures in which, the directors and/or the NBFC are holding substantial interest and the total amount of exposure to such entities; and

(9) that the deposits solicited by it are not insured.

32. Where an NBFC displays any advertisement in electronic media such as TV, even without soliciting deposits, it shall incorporate a caption/band in such advertisements indicating the following:

(1) As regards deposit taking activity of the company, the viewers may refer to the advertisement in the newspaper / information furnished in the application form for soliciting public deposits;

(2) The company is having a valid Certificate of Registration dated _______ issued by the Reserve Bank under section 45-IA of the RBI Act. However, the Reserve Bank of India does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for repayment of deposits/discharge of the liabilities by the company.

33. Where an NBFC intends to accept public deposit without inviting or allowing or causing any other person to invite such deposit, it shall, before accepting such deposit, deliver to the Reserve Bank for record, a statement in lieu of advertisement containing all the particulars required to be included in the advertisement pursuant to the Non-Banking Financial Companies and Miscellaneous Non-Banking Companies (Advertisement) Rules, 1977 as also the particulars stated in paragraph 31 above, duly signed in the manner provided in the aforesaid Rules.

34. A statement delivered under paragraph 33 above shall be valid till the expiry of six months from the date of closure of the financial year in which it is so delivered or until the date on which the balance sheet is laid before the company in general meeting or where the annual general meeting for any year has not been held, the latest day on which that meeting should have been held in accordance with the provisions of the Companies Act, 1956 or the Companies Act, 2013, whichever is earlier, and a fresh statement shall be delivered after the expiry of the validity of the statement, in each succeeding financial year before accepting public deposit in that financial year.

Chapter-IV General Provisions regarding repayment of Public Deposit

A. Minimum Lock-in Period and Repayment in the event of death of the depositor

35. No NBFC shall grant any loan against a public deposit or make premature repayment of a public deposit within a period of three months (lock-in period) from the date of its acceptance:

Provided that in the event of death of a depositor, a NBFC shall repay the public deposit prematurely, even within the lock-in period, to the surviving depositor/s in the case of joint holding with survivor clause, or to the nominee or the legal heir/s of the deceased depositor, on the request of the surviving depositor/s / nominee / legal heir, and only against submission of proof of death, to the satisfaction of the company.

B. Repayment of Public Deposits by an NBFC not being a Problem NBFC

36. Subject to the provisions contained in paragraph 35, an NBFC not being a problem NBFC may,

(1) permit premature repayment of a public deposit at its sole discretion:

Provided such NBFC shall, if so, permitted by the terms and conditions of acceptance of such deposit, repay it prematurely at the request of the depositor, after the expiry of three months from the date of deposit;

(2) grant a loan up to 75 per cent of the amount of public deposit to a depositor after the expiry of three months from the date of deposit at a rate of interest two percentage points above the interest rate payable on the deposit.

C. Repayment of Public Deposit in order to meet certain expenses of an emergent nature

37. An NBFC not being a problem NBFC, in order to meet certain expenses of an emergent nature, subject to the satisfaction of the NBFC concerned about such circumstances–

(1) ‘Tiny deposits’ may prematurely be paid to individual depositors, at the request of the depositor, before the expiry of three months from the date of acceptance of such deposits, in entirety, without interest;

(2) In case of other public deposits, not more than 50 per cent of the amount of the principal sum of deposit or ₹5 lakh, whichever is lower, may be prematurely paid to individual depositors, at the request of the depositors, before the expiry of three months from the date of acceptance of such deposits, without interest; the remaining amount with interest at the contracted rate shall be governed by the provisions of the extant directions as applicable for public deposits;

Provided that in cases of critical illness, 100 per cent of the amount of the principal sum of deposit, may be prematurely paid to individual depositors, at the request of the depositors, before the expiry of three months from the date of acceptance of such deposits, without interest.

Explanation:

(i) For this purpose, expenses of an emergent nature include medical emergency or expenses due to natural calamities / disaster as notified by the concerned Government / authority.

(ii) For the definition of ‘Critical illness’, NBFCs shall be guided by the IRDAI (Health Insurance) Regulations, 2016 and the guidelines issued thereunder, as amended from time to time.

(iii) The amount as per these provisions shall also apply to the existing deposit contracts wherein the individual depositor does not have a right to premature withdrawal of the deposit before the expiry of three months.

D. Repayment of Public Deposits by a Problem NBFC

38. Subject to the provisions contained in paragraph 35, in order to enable a depositor to meet expenses of an emergent nature, a problem NBFC may make premature repayment of, or grant a loan against, a public deposit in the following cases only, namely:

(1) repay a tiny deposit in entirety or repay any other public deposit up to an amount not exceeding ₹10,000/-; or

(2) grant a loan against a tiny deposit or up to an amount not exceeding ₹10,000/- against any other deposit, at a rate of interest two percentage points above the interest rate payable on the deposit.

E. Clubbing of Deposits by a Problem NBFC

39. All deposit accounts standing to the credit of sole / first named depositor in the same capacity shall be clubbed and treated as one deposit account for the purpose of premature repayment or grant of loan by a problem NBFC:

Provided that this clause shall not apply to premature repayment in the event of death of depositor as provided in paragraph 35.

F. Rate of interest on premature repayment of public deposits

40. Where an NBFC, whether at its sole discretion or at the request of the depositor, as the case may be, repays a public deposit after three months from the date of its acceptance, but before its maturity (including premature repayment in the case of death of the depositor), it shall pay interest at the following rates:

Chapter-V Miscellaneous Instructions

A. Furnishing of receipt to depositor

41. Every NBFC shall furnish to every depositor or his agent or group of joint depositors, a receipt for every amount received by the company by way of deposit.

42. The said receipt shall be duly signed by an officer authorised by the company in that behalf and shall state the date of deposit, the name of the depositor, the amount in words and figures received by the company by way of deposit, rate of interest payable thereon and the date on which the deposit is repayable:

Provided that, if such receipts pertain to instalments subsequent to the first instalment of a recurring deposit it may contain only name of the depositor and date and amount of deposit.

B. Register of Deposit

43. Every NBFC shall keep one or more registers in respect of all deposits in which shall be entered separately in the case of each depositor the following particulars, namely: -

(1) name and address of the depositor,

(2) date and amount of each deposit,

(3) duration and the due date of each deposit,

(4) date and amount of accrued interest or premium on each deposit,

(5) date of claim made by the depositor,

(6) date and amount of each repayment, whether of principal, interest or premium,

(7) the reasons for delay in repayment beyond five working days and

(8) any other particulars relating to the deposit.

44. The register or registers aforesaid shall be kept at each branch in respect of the deposit accounts opened by that branch of the company and a consolidated register for all the branches taken together at the registered office of the company and shall be preserved in good order for a period of not less than eight calendar years following the financial year in which the latest entry is made of the repayment or renewal of any deposit of which particulars are contained in the register:

Provided that, if the company keeps the books of account referred to in sub-section (1) of section 209 of the Companies Act, 1956 or the corresponding provision of Companies Act, 2013 at any place other than its registered office in accordance with the proviso to that sub-section, it shall be deemed to be sufficient compliance with this clause if the register aforesaid is kept at such other place, subject to the condition that the company delivers to the Reserve Bank a copy of the notice filed with the Registrar of Companies under the proviso to the said sub-section within seven days of such filing.

45. NBFCs may maintain the particulars/ details of the deposits, as required under the above paragraph, on centralized computer database; provided the authenticated particulars of public deposits are sent to the respective branches, updating the information on quarterly basis i.e., as on March 31, June 30, September 30 and December 31, every year irrespective of the fact that the branch does not open deposit accounts. The information pertaining to a quarter should reach the branch concerned before the 10th day of the next quarter.

C. Branches and Appointment of Agents to Collect Deposits

46. No NBFC shall open its branch or appoint agents to collect deposits except as provided hereunder:

(1) An NBFC having the certificate of registration issued under section 45-IA of the RBI Act,1934 and otherwise entitled to accept public deposits as per paragraph 17 of these Directions, shall open its branch or appoint agents if its

Explanation: An NBFC with NOF greater than ₹50 crore and credit rating below AA, shall be eligible to open branches only within the state where its registered office is situated.

47. (1) for the purpose of opening a branch, an NBFC shall notify to the Reserve Bank of its intention to open the proposed branch;

(2) on receipt of such notification, the Reserve Bank may, on being satisfied that in the public interest or in the interest of the concerned NBFC or for any other relevant reasons to be recorded, reject the proposal and communicate the same to the NBFC;

(3) if no advice of rejection of the proposal under (2) above is communicated by the Reserve Bank within 30 days from the receipt of such notification, the NBFC may proceed with its proposal.

D. Closure of Branches

48. No NBFC shall close its branch / office without publishing such intention in any one national level newspaper and in one vernacular newspaper in circulation in the relevant place indicating therein the purpose and arrangements being made to service depositors etc. and without advising the Reserve Bank, before ninety days of the proposed closure.

49. An intimation along with a copy of the notice in respect of above should be sent within seven days of its publication in the newspapers to the Regional Office of the Reserve Bank under whose jurisdiction the registered office of the company is located.

E. Nomination rules under section 45QB of the RBI Act, 1934

50. In terms of section 45QB of the RBI Act, 1934 the depositor/s of NBFC may nominate, in the manner prescribed under the rules made by the Central Government under section 45ZA of the Banking Regulation Act, 1949 (the BR Act, 1949) one person to whom, in the event of death of the depositor/s, the amount of deposit shall be returned by the NBFC. It has been decided in consultation with the Government of India, that the Banking Companies (Nomination) Rules, 1985 are the relevant rules made under section 45ZA of the BR Act, 1949.

51. Accordingly, NBFC shall accept nominations made by the depositors in the form similar to that specified under the said Rules. In terms of the Rule 2(9) of the said Rules, NBFCs are required to acknowledge in writing to the depositor/s the filling of the relevant duly completed form of nomination, cancellation and/or variation of the nomination.

52. NBFCs shall devise a proper system of acknowledging the receipt of duly completed form of nomination, cancellation and / or variation of the nomination. Such acknowledgement shall be given to all the customers irrespective of whether the same is demanded by the customers. Further, NBFCs shall introduce the practice of recording on the face of the passbooks / receipts the position regarding availment of nomination facility with the legend ‘Nomination Registered’ and they shall also indicate the name of the Nominee in the passbook / receipt, in case the customer is agreeable to the same.

F. Safe Custody of Liquid Assets

53. Every NBFC shall -

(1) open a Subsidiary General Ledger (SGL) account with the Reserve Bank or a Gilt account with Constituent's Subsidiary General Ledger (CSGL) account holder or a dematerialized account with a depository through a depository participant registered with the Securities and Exchange Board of India and keep the unencumbered approved securities required to be maintained by it in pursuance of section 45IB of the RBI Act, 1934 and the Directions as specified in Chapter II of these Directions in such account;

(2) designate one of the scheduled commercial banks, in the place where the registered office of the NBFC is situated, as its designated banker and entrust, in physical form, to such bank or the Stock Holding Corporation of India Ltd. (SHCIL) the unencumbered term deposits in any scheduled commercial bank maintained by it in pursuance of directions as specified in Chapter II of these Directions; and intimate the name and address of such entity where it has opened its gilt account or the depository (and the depository participant) where it has held its dematerialised account, in writing, to the Regional Office of the Reserve Bank under whose jurisdiction the registered office of the company is situated, as specified in First Schedule hereto:

Provided that where an NBFC intends to entrust the securities specified in clause (2) above with the entity, at a place other than the place at which its registered office is located, it may do so with the prior approval, in writing, of the Regional Office of the Reserve Bank under whose jurisdiction the registered office of the company is situated, as specified in First Schedule hereto:

Provided further that the government securities held in the said SGL account or gilt account or dematerialised account, shall not be traded, either by entering into ready forward contracts, including reverse ready forward contracts, or otherwise, except, by following the procedure and to the extent, as hereinafter specified.

54. The securities mentioned in paragraph 53 above shall continue to be kept as specified therein for the benefit of the depositors and shall not be withdrawn or encashed or otherwise dealt with by the NBFC except for repayment to the depositors with the prior approval of Reserve Bank:

Provided that,

(i) An NBFC may withdraw a portion of such securities in proportion to the reduction of its public deposits duly certified to that effect by its auditor;

(ii) the market value of these securities shall, at no point of time, be less than the percentage of public deposits as specified in the directions as specified in Chapter II of these Directions.

55. Where the NBFC intends to trade, either by entering into ready forward contracts, including reverse ready forward contracts, or otherwise, in the government securities that are held in excess of the requirement under section 45-IB of the RBI Act, 1934 and directions as specified in Chapter II of these Directions, the same shall be undertaken by opening a separate SGL account or gilt account or dematerialised account, subject to the Reserve Bank’s instructions in the matter, for keeping such excess Government securities.

56. In order to protect the interest of depositors, an exclusive SGL or gilt account or dematerialized account to hold Government securities shall be maintained for securities held for the purpose of compliance with section 45-IB of the RBI Act, 1934. This account shall be operated only for purchase or sale of securities due to increase or decrease in the quantum of public deposits or withdrawal of securities for encashment on maturity or for repayment to depositors in special circumstances.

G. Employees Security Deposit

57. An NBFC receiving any amount in the ordinary course of its business as security deposit from any of its employees for due performance of his duties shall keep such amount in an account with a scheduled commercial bank or in a post office in the joint names of the employee and the company on the conditions that -

(1) it shall not withdraw the amount without the consent in writing of the employee; and

(2) the amount shall be repayable to the employee along with interest payable on such deposit account unless such amount or any part thereof is liable to be appropriated by the company for the failure on the part of the employee for due performance of his duties.

H. Information to be included in the Board's Report

58. In every report of the Board of Directors laid before the company in a general meeting under sub-section (1) of section 217 of the Companies Act, 1956 or the corresponding provision of Companies Act, 2013, there shall be included in the case of an NBFC, the following particulars or information, namely:-

(1) the total number of accounts of public deposit of the company which have not been claimed by the depositors or not paid by the company after the date on which the deposit became due for repayment; and

(2) the total amounts due under such accounts remaining unclaimed or unpaid beyond the dates referred to in clause (1) as aforesaid.

59. The said particulars or information shall be furnished with reference to the position as on the last day of the financial year to which the report relates and if the amounts remaining unclaimed or undisbursed as referred to in clause (2) of the preceding paragraph exceed in the aggregate a sum of rupees five lakhs, there shall also be included in the report a statement on the steps taken or proposed to be taken by the Board of Directors for the repayment of the amounts due to the depositors remaining unclaimed or undisbursed.

I. Copies of Balance Sheet and Accounts together with the Directors' Report and notes on accounts to be furnished to the Reserve Bank

60. Every NBFC accepting / holding public deposit shall deliver to the Reserve Bank an audited balance sheet as on the last date of each financial year and an audited profit and loss account in respect of that year as passed by the company in general meeting together with a copy of the report of the Board of Directors laid before the company in such meeting in terms of section 217(1) of the Companies Act, 1956 or the corresponding provision of Companies Act, 2013 within fifteen days of such meeting as also a copy of the report and the notes on accounts furnished by its Auditor.

J. Cover for Public Deposits - Creation of Floating Charge on Liquid Assets

61. In order to ensure protection of depositors’ interest, NBFC shall ensure that at all times there is full cover available for public deposits accepted by it.

(1) While calculating this cover the value of all debentures (secured and unsecured) and outside liabilities other than the aggregate liabilities to depositors shall be deducted from the total assets. Further, the assets should be evaluated at their book value or realizable / market value whichever is lower for this purpose. It shall be incumbent upon the NBFC concerned to inform the Regional Office of the Reserve Bank wherein it is registered, in case the asset cover calculated as above falls short of the liability on account of public deposits. NBFCs accepting / holding public deposits shall create a floating charge on the statutory liquid assets invested in terms of section 45-IB of the RBI Act, 1934 in favour of their depositors. Such charge shall be duly registered in accordance with the requirements of the Companies Act, 1956 or the Companies Act, 2013.

(2) NBFCs shall create the floating charge on the statutory liquid assets maintained in terms of section 45-IB of the RBI Act, 1934 and in terms of notifications issued by the Reserve Bank from time to time, in favour of their depositors through the mechanism of 'Trust Deed'. The charge is required to be registered with the Registrar of Companies and the information in this regard is required to be furnished to the trustees and the Reserve Bank. A copy of the 'Draft Trust Deed' containing the details in this regard is enclosed as Annex I for the guidance of the NBFCs. The 'Trustee Guidelines' are also enclosed as Annex II.

K. NBFC failing to repay public deposit Prohibited from making Loans and Investments

62. An NBFC which has failed to repay any public deposit or part thereof in accordance with the terms and conditions of such deposit, as provided in section 45QA (1) of the RBI Act, 1934 shall not grant any loan or other credit facility by whatever name called or make any investment or create any other asset as long as the default exists.

L. Restrictions on Investments in Land and Building and Unquoted shares

63. No NBFC-ICC, which is accepting public deposit, shall, invest in-

(1) land or building, except for its own use, an amount exceeding ten per cent of its owned fund;

(2) unquoted shares of another company, which is not a subsidiary company or a company in the same group of the NBFC, an amount exceeding twenty per cent of its owned fund.

Provided that the land or building or unquoted shares acquired in satisfaction of its debts shall be disposed of by the non-banking financial company within a period of three years or within such period as extended by the Reserve Bank, from the date of such acquisition if the investment in these assets together with such assets already held by the NBFC exceeds the above ceiling;

Explanation - While calculating the ceiling on investment in unquoted shares, investments in such shares of all companies shall be aggregated.

Provided further that the ceiling on the investment in unquoted shares shall not be applicable to an investment and credit company in respect of investment in the equity capital of an insurance company upto the extent specifically permitted, in writing, by the Reserve Bank.

Chapter-VI Reporting Requirements

64. The reporting requirements in respect of NBFCs as prescribed by Department of Supervision of the Reserve Bank shall be adhered to by the NBFC. 

Chapter-VII Repeal and Other Provisions

A. Repeal and saving

65. With the issue of these Directions, the existing instructions / guidelines relating to Acceptance of Public Deposits as applicable to NBFCs stand repealed, as communicated vide circular DOR.RRC.REC.302/33-01-010/2025-26 dated November 28, 2025. The Directions, instructions, and guidelines repealed prior to the issuance of these Directions shall continue to remain repealed.

66. Notwithstanding such repeal, any action taken or purported to have been taken, or initiated under the repealed Directions, instructions, or guidelines shall continue to be governed by the provisions thereof. All approvals or acknowledgments granted under these repealed lists shall be deemed as governed by these Directions. Further, the repeal of these directions, instructions, or guidelines shall not in any way prejudicially affect:

a. any right, obligation or liability acquired, accrued, or incurred thereunder;

b. any, penalty, forfeiture, or punishment incurred in respect of any contravention committed thereunder;

c. any investigation, legal proceeding, or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture, punishment as aforesaid; and any such investigation, legal proceedings or remedy may be instituted, continued, or enforced and any such penalty, forfeiture or punishment may be imposed as if those directions, instructions, or guidelines had not been repealed.

B. Application of other laws not barred

67. The provisions of these Directions shall be in addition to, and not in derogation of the provisions of any other laws, rules, regulations, or directions, for the time being in force.

C. Interpretations

68. For the purpose of giving effect to the provisions of these Directions or in order to remove any difficulties in the application or interpretation of the provisions of these Directions, the Reserve Bank may, if it considers necessary, issue necessary clarifications in respect of any matter covered herein and the interpretation of any provision of these Directions given by the Reserve Bank shall be final and binding. Non-compliance with the Directions shall invite penal action under the provisions of the RBI Act, 1934.

(J P Sharma)
Chief General Manager

First Schedule

(Please see paragraphs 53 to 56 of these Directions)

Area under the jurisdiction of each Regional Office of the
Reserve Bank of India