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Notification as amended upto June 30, 2012 – “Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998” .Part:- 1


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RBI/2013-14/33
DNBS (PD) CC No 331/03.02.001/2013-14
July 1, 2013
To
The Chairman/CEOs of all Non-Banking Financial Companies (except Residuary Non-Banking Companies and Miscellaneous Non-Banking Companies)
Dear Sirs,
Notification as amended upto June 30, 2012 – “Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998”
As you are aware, in order to have all current instructions on the subject at one place, the Reserve Bank of India issues updated Circulars/notifications. The instructions contained in the Notification No.DFC.118/DG (SPT)-98 dated January 31, 1998 updated as on June 30, 2013 are reproduced below. The updated Notification has also been placed on the RBI web-site (http://www.rbi.org.in).
Yours faithfully,
(N. S. Vishwanathan)
Principal Chief General Manager

RESERVE BANK OF INDIA
DEPARTMENT OF NON-BANKING SUPERVISION
CENTRAL OFFICE
CENTRE I, WORLD TRADE CENTRE,
CUFFE PARADE, COLABA,
MUMBAI- 400 005.
Notification No.DFC.118/DG (SPT)-98 dated January 31, 1998
The Reserve Bank of India having considered it necessary in the public interest and being satisfied that for the purpose of enabling the Bank to regulate the credit system to the advantage of the country, it is necessary to give the directions set out below, hereby, in exercise of the powers conferred by sections 45J, 45K, 45L and 45MA of the Reserve Bank of India Act, 1934 (2 of 1934) and of all the powers enabling it in this behalf, and in supersession of the earlier directions contained in Notification No.DFC.114/DG(SPT)-98 dated January 2, 1998 gives to every non-banking financial company the directions hereinafter specified.
PART I - PRELIMINARY
Short title and commencement of the directions
1. These directions shall be known as the “Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998”.  They shall come into force with effect from January 31, 1998 and any reference in these directions to the date of commencement thereof shall be deemed to be a reference to that date.
Definitions
2. (1) For the purpose of  these directions, unless the context otherwise requires, -
(ia) “Asset Finance Company” means any company which is a financial institution carrying on as its principal business the financing of physical assets supporting productive / economic activity, such as automobiles, tractors, lathe machines, generator sets, earth moving and material handling equipments, moving on own power and general purpose industrial machines.
(i) "depositor" means any person who has made a deposit with a company; or a heir, legal representative, administrator or assignee of the depositor;
(ii) Deleted
(iii) "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;
(iv) Deleted
(v) "insurance company" means any company registered under section 3 of the Insurance Act, 1938 (4 of 1938);
(vi) "investment company" means any company which is a financial institution carrying on as its principal business the acquisition of securities;
(vii)  “lending public financial institution” means -
  1. a public financial institution specified in or under section 4A of the Companies Act, 1956 (1 of 1956); or
  2. a State Financial, Industrial or Investment  Corporation; or
  3. a scheduled commercial bank ; or
  4. the General Insurance Corporation of India established in pursuance of the   provisions of   section 9   of   the General Insurance Business (Nationalisation) Act, 1972 (57 of 1972); or
  5. any other Institution which the Reserve Bank of India may, by  notification, specify in this behalf;
(viii) "loan company" means any company which is a financial institution carrying on as its principal business the providing of finance whether by making loans or advances  or otherwise for any activity other than its own but does not  include an Asset Finance Company.
(ix)"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 (1 of 1956);
[(ixa) “mutual benefit company” means a company not notified under section 620A of the Companies Act, 1956 (1 of 1956) and carrying on the business of a non-banking financial institution, -
  1. on 9th January 1997; and
  2. having the aggregate of net owned funds and preferential share capital of not less than ten lakhs of rupees; and
  3. has applied for issue of certificate of registration to the Bank on or before 9th July 1997; and
  4. is complying with the requirements contained in the relevant provisions of the Directions issued under Section 637A of the Companies Act, 1956 to Nidhi Companies by the Central Government]; 
(x) ’net owned fund’ means net owned fund as defined under section 45-IA of the Reserve Bank of India Act, 1934 (2 of 1934)  including the paid up preference shares which are compulsorily convertible into equity ;
(xi) “non-banking financial company” means only the non-banking  institution which is a loan company6 or an investment company or an asset finance company or a mutual benefit financial company;
(xii) ’public deposit’, means a deposit as defined under section 45 I(bb) of the Reserve Bank of India Act, 1934 (2 of 1934) excluding the following :
(a) 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;
(b) any amount received from the Industrial Development Bank of India established under the Industrial Development Bank of India Act, 1964 (18 of 1964), or the Life Insurance Corporation of India established under the Life Insurance Corporation Act, 1956 (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 (57 of 1972), or the Small Industries Development Bank of India established under the Small Industries Development Bank of India Act, 1989 (39 of 1989), or the Unit Trust of India established under the Unit Trust of India Act, 1963 (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 any other institution that may be specified by the Reserve Bank  of India in this behalf ;
(c) any amount received by  a  company  from any other  company;
(d) any amount received by way of subscriptions to any shares, stock, bonds   or debentures pending the allotment of the said shares, stock, bonds or debentures and any amount received by way of calls-in-advance on shares, in accordance with the Articles of Association of the company so long as such amount is   not  repayable  to   the  members  under  the  Articles  of Association of the company;
(e) 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 (1 of 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;
7[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 ;]
(f) 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;
(g) 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:-
  1. 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,
  2. the loan is provided by the promoters themselves and/or by their relatives, and not from their friends and business associates, and
  3. the exemption under this sub-clause shall be available only till the loan of financial institution is repaid and not  thereafter;
[(h) any amount received from a Mutual Fund which is governed by the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996; ]
[(i) 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
[(j) any amount received from a relative of a director of an 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 (1 of 1956).]
[(k) any amount received by issuance of commercial paper, in accordance with the guidelines issued by the Bank, vide Circular No. IECD.3/08.15.01/2000-2001 dated October 10, 2000];
(l) any amount received by a Systemically important non-deposit taking non-banking financial company by issuance of 'perpetual debt instruments'  in accordance with Company Circular DNBS (PD) CC. No.131 /03.05.002 /2008-2009 dated October 29, 2008 as amended from time to time ;
“(m) 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.”
(xiii) "securities" means securities as defined in section 2(h) of the Securities Contracts (Regulation) Act, 1956 (42 of 1956);
(xiv) “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 (15 of 1992); and
(xv)  “stock exchange” means a company recognised as a stock exchange under section 4 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956).
(2) Words or expressions used but not defined herein and defined in the Reserve Bank of India Act, 1934 (2 of 1934) or in the Companies Act, 1956 (Act No.1 of 1956) [or Non-Banking Financial Companies Prudential Norms (Reserve Bank) Directions, 1998 or the Residuary Non-Banking Companies (Reserve Bank) Directions, 1987] shall have the same meaning as assigned to them in those Acts.
(3) (i) If any question arises as to whether a company is a financial institution or not, such question shall be decided by the Reserve Bank  of India in   consultation with the Central Government and such decision shall be final and be binding on all the parties concerned.
(ii) If any question arises as to whether a company which is a financial institution is a loan company or an investment company or an asset finance company such question shall be decided by the Reserve Bank of India, having regard to the principal business of the company and other relevant factors and such decision shall be final and be binding on all the parties concerned.
NOTE : Deleted
PART II - ACCEPTANCE OF PUBLIC DEPOSITS
Restrictions on acceptance of  public deposits by mutual benefit financial companies
3. (1) [deleted]
(2) [The provisions contained in these directions shall not apply to 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).]
Restrictions on acceptance of public deposits by non-banking financial companies
4. Minimum Credit Rating
(1) On and from January 31, 1998, -
(i) no non-banking financial company having Net Owned Fund (hereinafter referred  to as `NOF’) of twenty five lakh of rupees and above shall accept public deposit unless it has obtained  minimum  investment grade or other specified credit rating  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 of India  along with return on prudential norms :
[Provided that this clause shall not apply to an Asset Finance Company referred to in clause (a) of sub-paragraph (4) hereunder;].
(ii) in the event of upgrading or downgrading of credit rating of any non-banking financial company to any level from the level previously held by the non-banking financial company, it shall within fifteen working days of its being so rated inform, in writing, of such upgrading/downgrading to the Reserve Bank of India.
Approved Credit Rating Agencies and Minimum Investment Grade Credit Rating
The names of approved credit rating agencies and the minimum credit rating shall be as follows:-
Name of the agency
Minimum investment Grade Rating
(a) The Credit Rating Information Services of India Ltd. (CRISIL) FA- (FA Minus)
(b) ICRA Ltd. MA- (MA Minus)
(c) Credit Analysis & Research Ltd. (CARE) CARE  BBB(FD)
(d) [Fitch Ratings India Private Ltd.] [tA-(ind)(FD) ]
(e) Brickwork Ratings India Pvt. Ltd. (Brickwork) BWR F A
Prohibition from accepting demand deposit
(2) On and from January 31, 1998, no non-banking financial company shall accept or renew any public deposit whether accepted before or after January 31, 1998, which is repayable on demand.
Period  of Public Deposit
(3) On and from January 31, 1998, no non-banking financial company shall accept or renew any public deposit whether accepted before or after January 31, 1998 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.
(4) Ceiling on quantum of deposit
Asset Finance Company (AFC)
Loan Company (LC) and Investment Company (IC) –
Acceptance of public deposit
No asset finance company or loan company or investment company shall, accept or renew public deposit except as provided hereunder -  AFC
(a) An asset finance company -
  1.  having NOF of twenty five lakh of rupees or more; and
  2. complying  with all the  prudential norms with capital adequacy ratio of not less than fifteen percent as per last audited balance-sheet,
may, 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 or public deposit up to ten crore of rupees, whichever is lower.
(b) An asset finance company,  -
  1. having NOF of twenty five lakh of rupees or more; 
  2. complying with all the prudential norms; and
  3. having minimum investment grade credit rating,
may, 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 four times of its NOF.
LC/IC
(c) A loan company or an investment company,  –
  1. having NOF of twenty five lakh of rupees or more; 
  2. having minimum investment grade credit rating; and
  3. complying with all the prudential norms with capital adequacy ratio of not less than fifteen percent as per last audited balance-sheet,
may, 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 a loan company or an investment company which is complying  with all the above conditions and having, as on the date of its coming into force of these directions, AAA (triple A) grade credit rating but not having capital adequacy ratio of fifteen percent may, so long it continues to maintain the same position of its credit rating, accept or renew public deposit only up to the extent of not exceeding the amount outstanding as at the close of business on December 18, 1998 or one and one-half time of its NOF, whichever is more, and shall bring down its public deposit to the level as specified in paragraph 4(6) of the directions and also attain the capital adequacy ratio of fifteen percent before March 31, 2000.
(d) A loan company or an investment company which complies with all the prudential norms and having, as on the date of coming into force of these directions–
  1. NOF of twenty five lakh of rupees or more; and
  2. AA (double A) grade credit rating; but not having capital adequacy ratio of fifteen percent or above as per last audited balance-sheet,
may, so long it continues to maintain the same position of its credit rating, accept or renew the public deposit together with the amounts outstanding in the books of the company on the date of acceptance or renewal of such deposit, not exceeding an amount equivalent to its NOF until it attains the capital adequacy ratio of fifteen percent but not later than March 31, 2000 (as per audited balance-sheet) with other stipulations remaining the same.
(e) A loan company or an investment company which complies with all the prudential norms and having, as on the date of coming into force of these directions –
  1. NOF of twenty five lakh of rupees or more; and
  2. A (single A) grade credit rating but not having capital adequacy ratio of fifteen percent or above as per last audited balance-sheet,
may, so long it continues to maintain the same position of its credit rating, accept or renew the public deposit, together with the amounts outstanding in the books of the company as on the date of acceptance or renewal of such deposit not exceeding an amount equivalent to one-half of its NOF until it attains the capital adequacy ratio of fifteen percent but not later than  March 31, 2000
(as per audited balance-sheet) with other stipulations remaining the same.
Downgrading of Credit Rating 
(5) In the event of downgrading of credit rating below the minimum specified investment grade as provided for in paragraph 4(4), a non-banking financial company shall regularise the excess deposit as provided hereunder :
AFC
(i) An asset finance company shall, -
  1. with immediate effect, stop accepting public deposit, if it is  already holding public deposit to the extent permissible under sub-clause (b) of paragraph 4(4) above;
  2. report  the  position  within  fifteen working  days to the  Reserve Bank of India; and
  3. reduce,  within  three years from  the date of such downgrading of credit rating,  the amount of excess public deposit to nil or the appropriate extent permissible under sub-clause (a) of paragraph 4(4) above as the case may be, to which it is entitled to accept, by repayment as and when such deposit falls due or otherwise.
LC/IC
(ii) A  loan  company or an investment company shall,
  1. with  immediate effect, stop accepting public  deposit;
  2. report the position within fifteen working days to the Reserve Bank of India; and
  3. reduce, within  three years from  the date of such downgrading of credit rating,  the amount of excess public deposit to nil by repayment as and when such deposit falls due or otherwise.
Regularisation of the public deposits accepted earlier and held in excess of the permissible extent
(6) Where  an  asset finance company or a loan company or an investment company holds, at the close of business on December 18, 1998 public deposit in excess of the appropriate extent to which it is entitled to accept under the above provisions of these directions, it shall, -
  1. stop accepting  public deposit; and
  2. reduce, before December 31, 2001, the amount of excess public deposit to nil or the  appropriate extent permissible  under sub-clause (d) or (e) of paragraph 4(4) above as the case may be, by repayment as and when such deposit falls due or otherwise.
Note :
In the event of  excess public deposits arising out of the regulatory ceiling or downgrading of credit rating, the NBFC may renew the maturing public deposit subject to the compliance of the repayment stipulations contained in sub-paragraphs (5) and (6) of paragraph 4 and other provisions of these directions. It is to clarify that no matured public deposit shall be renewed without the express and voluntary consent of the depositor.
Ceiling on the rate of interest
((7) On and from April 24, 2007, no non-banking financial company 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.]
(7A)  On and from September 18, 2003, no non-banking financial company shall invite or accept or renew repatriable deposits from Non-Resident Indians in terms of Notification No.FEMA.5/2000-RB dated May 3, 2000 under Non-Resident (External) Account Scheme at a rate exceeding the rate specified by the Reserve Bank of India 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.]
Payment of brokerage
(8) On and from January 31, 1998 no non-banking financial company 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 percent of the deposit so collected.
[Intimation of maturity of deposits to depositors
(8A) It shall be the obligation of the non-banking financial company to intimate the details of maturity of the deposit to the depositor at least two months before the date of maturity of the deposit.”]
Renewal of  public deposit
(9) Where a non-banking financial company 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.
Payment of interest on overdue public deposits
(10) A non-banking financial company 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 a non-banking financial company fails to repay the deposit along with interest on maturity on the claim made by the depositor, the non-banking financial company shall be liable to pay interest from the date of claim till the date of repayment at the rate as applicable to the deposit.
Joint deposit
(11) 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".
Particulars to be specified in application form soliciting public deposits
(12) (i) On and from  January 31, 1998, no non-banking financial company 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 (1 of 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.
(ii) The application form should also contain the following :-
(a) the credit rating assigned for its fixed deposit and the name of the credit rating agency which rated the company or a statement from the management if it is an asset finance company that, the quantum of public deposit held by it is not exceeding one and one-half times of  its NOF or  not exceeding  rupees ten  crore whichever is less;
(b) 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 whose full address  is given hereunder:
Give here the full address of the Bench of the Company Law Board under whose jurisdiction the registered office of the company is located;
(c) 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;
(d) 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;
(e) the  financial  activities  of the company are regulated by the Reserve Bank of India.  It must, however, be distinctly understood that Reserve  Bank of India 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;
(f) at  the end of application form but before the signature of the depositor, the following verification clause by the depositor should 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”.
(g)  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 non-banking financial company are holding substantial interest and the total amount of exposure to such entities.]
(iii) Every non-banking financial company 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.]
Advertisement and statement in lieu of advertisement:
(13) (i) Every non-banking financial company soliciting  public deposit 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 :-
(a) the actual rate of return by way of interest, premium, bonus  other    advantage  to the depositor;
(b) the mode of repayment  of deposit;
(c) maturity period of deposit;
(d) the interest payable on  deposit;
(e) the rate of interest which will be payable to the depositor in case the depositor withdraws the deposit prematurely;
(f) the terms and conditions subject to which a deposit will be renewed;
(g) any other special features relating to the terms and conditions subject to which the deposit is accepted/renewed;
(h)  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]
(i) that the deposits solicited by it are not insured.
13 (i) (A) Where an NBFC displays any advertisement in electronic media such as TV, even without soliciting deposits, it should incorporate a caption/band in such advertisements indicating the following:
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;
The company is having a valid Certificate of Registration dated _______ issued by the Reserve Bank of India under section 45-IA of the Reserve Bank of India Act, 1934.  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.]
(ii) Where a non-banking financial company 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  of India 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 clause (i)  hereinabove, duly signed in the manner provided in the aforesaid Rules.
(iii) A statement delivered under clause (ii) 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 (1 of 1956), 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.

Ozg NBFC Consultant

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Back Office Phone # 09811415831-37-61-72-84-92-94

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