How to Register an NBFC in India in 2026: Eligibility, NOF ₹10 Crore, COSMOS Steps, Documents & Timelines

If you are exploring how to register an NBFC in India, the process follows a defined statutory path: incorporate a company under the Companies Act 2013, demonstrate Net Owned Funds (NOF) of at least ₹10 crore, prepare a compliant business plan, file your application through RBI’s COSMOS portal, and submit the physical documentation set to your regional RBI office. The Reserve Bank of India reviews applications over a typical 90‑ to 180‑day window before issuing, or declining, a Certificate of Registration (CoR) under Section 45‑IA of the RBI Act, 1934.

This guide walks through every stage in detail, from the legal eligibility criteria and the 50‑50 principal‑business test to the precise COSMOS portal fields, the complete documents checklist, realistic NBFC registration fees in India, and the post‑CoR compliance obligations that follow approval.

Here is what you will learn in this article:

• Statutory eligibility. Section 45‑IA requirements, the 50‑50 rule, fit‑and‑proper criteria and permitted company types.
• NOF ₹10 crore. What counts, how to prove it, and sample auditor‑certificate wording.
• COSMOS portal walkthrough. Step‑by‑step NBFC registration online, e‑form preparation, CARN generation, document upload and payment.
• Documents checklist. Every item RBI expects, in one downloadable table.
• Fees, costs & timelines. Application fees, MCA charges, professional costs and a realistic timeline.
• Post‑registration obligations. Prudential norms, return filing and ongoing capital maintenance.

How to Register an NBFC in India, Step‑by‑Step at a Glance

Before diving into the detail, the following seven‑step summary gives you the end‑to‑end picture of the NBFC registration process. Use it as a roadmap and refer to the corresponding sections below for the full explanation of each stage.

1. Incorporate a company. Register a Public or Private Limited Company with the Registrar of Companies (MCA portal). Allow 7–15 business days.
2. Arrange NOF of ₹10 crore. Deposit unencumbered funds and obtain the auditor’s certificate and banker’s confirmation.
3. Prepare the business plan. Draft five‑year financial projections, a compliance framework outline and a description of proposed NBFC activities.
4. File on the RBI COSMOS portal. Complete the online e‑form, upload supporting documents and generate the Company Application Reference Number (CARN).
5. Pay the application fee. Remit the prescribed fee through the COSMOS payment gateway.
6. Submit the physical application. Print the COSMOS‑generated form, compile the full document set, and courier or hand‑deliver it to the regional RBI office.
7. RBI scrutiny & CoR issuance. The regional office undertakes due diligence, expect 90 to 180 days. If satisfied, RBI issues the NBFC Certificate of Registration.

Quick stats: Total elapsed time from incorporation to CoR is typically four to nine months. The all‑in NBFC license cost (excluding the NOF capital itself) ranges from approximately ₹5 lakh to ₹15 lakh depending on professional fees, while the NOF deposit of ₹10 crore must be evidenced at the point of application.

NBFC Registration Requirements RBI: Legal Eligibility & Statutory Framework

Understanding the legal prerequisites is the essential first step. RBI will not accept, let alone process, an application that fails to satisfy the statutory thresholds established under the Reserve Bank of India Act, 1934.

Section 45‑IA of the RBI Act, 1934, Explained

Section 45‑IA is the gateway provision. It mandates that no non‑banking financial company shall commence or carry on the business of a non‑banking financial institution without obtaining a CoR from the Reserve Bank and having the minimum NOF as prescribed. The section empowers RBI to grant or refuse registration after satisfying itself that the conditions relating to NOF, management quality and public interest are met. All NBFC registration requirements RBI imposes flow from this foundational statutory authority.

Crucially, Section 45‑IA applies to companies, not partnerships, LLPs or sole proprietorships. The applicant must be incorporated as either a Private Limited Company or a Public Limited Company under the Companies Act, 2013 (or the predecessor Companies Act, 1956, where still subsisting). Section 8 (not‑for‑profit) companies are not eligible for NBFC registration.

The 50‑50 (Principal Business) Test

RBI uses the “principal business criteria”, commonly called the 50‑50 rule, to determine whether a company falls within the regulatory definition of an NBFC. A company is treated as an NBFC if its financial assets constitute more than 50 per cent of its total assets (net of intangible assets) and its income from financial assets constitutes more than 50 per cent of its gross income. Both limbs must be satisfied simultaneously. If a company meets these thresholds, it must register as an NBFC; if it does not, it falls outside the NBFC regulatory perimeter, regardless of its memorandum objects.

Industry observers note that RBI applies this test not only at the point of initial application but on an ongoing basis. A company that drifts below the 50‑50 threshold may, in theory, be asked to surrender its CoR, while a company that drifts above it without registration faces enforcement action.

Fit & Proper Criteria and KYC for Promoters

RBI evaluates whether the promoters, directors and key management personnel satisfy its “fit and proper” standards. The assessment covers:

• Personal integrity. No criminal convictions, no adverse findings by financial regulators (SEBI, IRDA, PFRDA), and no disqualification under the Companies Act.
• Financial soundness. The promoter group must demonstrate adequate net worth and a credible source of capital for the NOF.
• Track record. RBI reviews the professional background, prior NBFC associations (if any), and experience in the financial sector.
• KYC compliance. Full KYC documentation, PAN, Aadhaar (for residents), passport (for NRIs/foreign nationals), address proof, and detailed personal net‑worth statements, is mandatory for every director and promoter holding 10 per cent or more of equity.

Foreign ownership note: Foreign direct investment in NBFCs is permitted up to 100 per cent under the automatic route for several categories (NBFC‑ICC, NBFC‑Factor, etc.), subject to applicable FEMA regulations and the minimum capitalisation norms separately prescribed by RBI. Foreign promoters must still clear the fit‑and‑proper test and supply apostilled/consularised documentation.

Net Owned Funds 10 Crore: What Counts, Proof & Mechanics

The minimum NOF requirement of ₹10 crore for new NBFC registrations has been in force since 1 October 2022, following RBI’s revised Scale Based Regulation (SBR) framework. This is the single most significant capital barrier to entry and the element that draws the most questions from founders asking how to register an NBFC in India.

NOF Definition

“Net Owned Fund” is defined under Section 45‑IA read with Section 45‑IC as the aggregate of paid‑up equity capital and free reserves, minus accumulated losses, deferred revenue expenditure and other intangible assets, and further reduced by investments in shares of subsidiaries, companies in the same group, and book value of debentures/bonds/loans/advances made to or deposits with subsidiaries and group companies.

Acceptable Instruments and Proof

RBI expects the NOF to be funded primarily from equity capital and free reserves, not borrowings. The ₹10 crore must be demonstrably unencumbered at the date of application. To prove this:

• Auditor’s certificate. A practising chartered accountant must certify the NOF computation as at a date not earlier than one month before the application date.
• Banker’s certificate. The company’s bankers must confirm the balances held.
• Fixed deposit receipts (FDRs). If part of the NOF is held in FDRs, those deposits must be unencumbered and not pledged against any facility.

Sample Auditor’s Certificate Wording

“We have examined the books of account and records of [Company Name] as at [Date]. Based on our examination and the information and explanations provided to us, we certify that the Net Owned Fund of the company, computed in accordance with Section 45‑IA of the Reserve Bank of India Act, 1934 read with the applicable RBI Directions, stands at ₹[Amount], which is not less than ₹10,00,00,000 (Rupees Ten Crore). The said amount is unencumbered and free from any charge or lien.”

This wording is indicative, the signing CA should adapt it to the entity’s specific circumstances. RBI may reject an application where the auditor’s certificate is ambiguous or fails to confirm the unencumbered status of the funds.

Ongoing NOF Maintenance

Meeting the ₹10 crore threshold is not a one‑time exercise. RBI requires NBFCs to maintain the prescribed minimum NOF on a continuing basis. A shortfall triggers supervisory action, including possible cancellation of the CoR. Applicants should factor this into their capital planning from day one, especially where the NOF is only marginally above the threshold at the point of filing.

RBI COSMOS Portal: How to Complete Your NBFC Registration Online

The COSMOS (Centralised Information Management System) portal is RBI’s mandatory electronic gateway for NBFC registration online. No paper‑only application is accepted; the e‑filing via COSMOS is a prerequisite, followed by a physical submission of signed copies. Below is the detailed walkthrough.

Step 1, Prepare the E‑Form and Business Plan

Before logging into COSMOS, assemble the following in final form:

• Company Application Excel template. Download the prescribed Excel‑format application form from the COSMOS portal. This template captures corporate details (CIN, registered office, directors), financial data (paid‑up capital, NOF), proposed NBFC activity type, and compliance declarations.
• Business plan. Prepare a five‑year business plan covering: (a) description of proposed financial activities, (b) target market and geography, (c) revenue model, (d) projected balance sheet and profit‑and‑loss account, (e) capital adequacy projections, (f) risk management framework, and (g) technology and infrastructure.
• Board resolution. A certified copy of the board resolution authorising the NBFC application and designating the signatory.

Ensure all financials are consistent across the e‑form, business plan, and auditor’s certificate. RBI scrutinises discrepancies closely, and an inconsistency in the NOF figure between the e‑form and the auditor’s certificate is one of the most common reasons for application queries.

Step 2, Upload Documents and Attachments

Log in to the RBI COSMOS portal using the company’s registered credentials. Navigate to the “Company Registration” section and select “New Application.” Upload the completed Excel e‑form along with each supporting document. Follow these best practices:

• File naming convention. Use a clear, consistent naming protocol (e.g., CompanyName_MOA.pdf, CompanyName_NOF_Certificate.pdf). Descriptive file names prevent delays in RBI’s internal document‑matching process.
• File size and format. PDF is the standard format for all attachments. Keep each file under 5 MB; if a document exceeds the size limit, compress the PDF without degrading legibility.
• Completeness check. The portal will flag mandatory fields that remain empty. However, it does not validate the substance of uploaded documents, an incomplete business plan or an undated auditor’s certificate will pass the upload stage but cause rejection later.

Step 3, Generate the CARN and Make Payment

Once all fields are completed and documents uploaded, the portal generates a Company Application Reference Number (CARN). The CARN is the unique tracking identifier for your application throughout the RBI review cycle. Immediately after CARN generation:

• Pay the RBI application fee through the COSMOS payment gateway. The fee amount is prescribed by RBI and may be updated periodically, confirm the current amount on the portal before remitting.
• Download and save the payment acknowledgement receipt and the CARN confirmation page.

Common portal error: Session timeout during payment is a frequently reported issue. If the payment page times out, do not re‑initiate payment immediately. Wait for the portal to update (typically 24 hours) and check whether the payment was debited. If a double debit occurs, raise a ticket through the COSMOS helpdesk citing your CARN.

Step 4, Physical Submission Checklist and Cover Letter

The COSMOS e‑filing is only half the process. RBI requires the full application set to be submitted in physical (hard‑copy) form to the regional office of the Department of Non‑Banking Supervision (DNBS) that has jurisdiction over the company’s registered office. The physical set should include:

• Printout of the COSMOS‑generated application form, signed by the authorised signatory on every page.
• All supporting documents (originals or certified true copies, as applicable), arranged in the order listed in the COSMOS form.
• The CARN confirmation printout and payment receipt.
• A cover letter on the company’s letterhead referencing the CARN, summarising the enclosed documents, and providing a single point of contact (name, designation, phone, email) for RBI queries.

Send the package via registered post with acknowledgement due (RPAD) or deliver it in person. Retain a copy of the full physical set for your records, RBI may request duplicate copies during scrutiny.

Documents Checklist for NBFC Registration

The table below consolidates every document RBI expects in the application package. Treat this as your master checklist.

Sample business plan table of contents: Executive summary → Company overview and shareholding → Proposed NBFC activities → Market analysis → Revenue model → Five‑year projections (P&L, balance sheet) → Capital adequacy and NOF maintenance plan → Risk management framework → Technology infrastructure → Compliance and governance framework → Management team profiles.

NBFC Registration Fees in India, Costs & Timelines

Transparency on the NBFC license cost is one of the most requested data points. The table below breaks down the expected expenditure into its constituent components.

Total estimated professional costs (excluding NOF capital): ₹3 lakh to ₹15 lakh, depending on whether the promoter handles certain steps in‑house or engages a full‑service NBFC registration consultant.

Realistic Timelines

The 90‑to‑180‑day RBI window is the biggest variable. Delays typically arise from: (a) incomplete documentation requiring supplementary submissions, (b) adverse findings during the promoter background check, (c) RBI’s internal workload and regional office capacity, and (d) multiple rounds of clarificatory queries. Engaging experienced legal counsel at the outset materially reduces the risk of avoidable delays.

Post‑Filing Scrutiny, Approval Criteria & Post‑CoR Obligations

Once the physical application reaches the regional DNBS office, RBI’s review process broadly follows these stages:

• Preliminary screening. The regional office checks that the application is complete and the CARN matches the physical set. Incomplete applications are returned or held in abeyance.
• Substantive due diligence. RBI verifies the promoter group’s credentials, cross‑checks credit reports, and may conduct on‑site visits to the company’s registered and principal business offices.
• Clarificatory queries. RBI issues written queries, sometimes multiple rounds, seeking additional information or clarification on the business plan, source of funds, or promoter history. Prompt, comprehensive responses accelerate the timeline.
• Decision. RBI either issues the NBFC Certificate of Registration (with or without conditions) or issues a rejection order with reasons. A rejected applicant may reapply after addressing the deficiencies cited.

Once the CoR is in hand, the registered NBFC must comply with an ongoing regulatory framework that includes:

• Prudential norms. Capital adequacy ratios, asset classification, provisioning and concentration norms as prescribed under RBI’s Master Direction for NBFCs.
• Periodic return filing. Monthly, quarterly and annual returns to RBI through the COSMOS portal and XBRL submissions.
• Board governance. Minimum independent directors, constituted audit committees and compliance reporting structures.
• KYC / AML compliance. Adherence to the Prevention of Money Laundering Act (PMLA) and RBI’s KYC Master Direction.
• NOF maintenance. The ₹10 crore (or higher, where applicable) NOF threshold must be maintained at all times. Annual auditor confirmations are expected.

Industry observers note that the 2026 revisions to RBI’s NBFC regulatory framework have reinforced supervisory expectations around governance quality and digital‑lending practices. Early‑stage compliance planning, ideally built into the business plan submitted with the application, significantly eases the post‑registration transition.

Comparison: NBFC Types & Reporting Obligations

Not every NBFC is alike. The table below highlights three common categories and the key differences that affect registration and ongoing compliance. Founders should select the correct classification before filing their COSMOS application, as the choice impacts NOF requirements, permissible activities and supervisory intensity.

For a broader perspective on structuring regulated financial vehicles, see the related guide on how to start your own investment fund.

Conclusion: How to Register an NBFC in India, Practical Checklist

Registering an NBFC in India is a structured, multi‑stage process anchored in Section 45‑IA of the RBI Act, 1934. For any founder, CFO or in‑house counsel evaluating how to register an NBFC in India, the practical checklist is:

• Incorporate a Private or Public Limited Company through MCA.
• Arrange and evidence net owned funds of at least ₹10 crore (auditor’s certificate and banker’s confirmation).
• Prepare a comprehensive five‑year business plan with capital adequacy and risk projections.
• Complete the NBFC registration online via the RBI COSMOS portal, e‑form, document upload, CARN generation and fee payment.
• Submit the full physical application set to the jurisdictional DNBS regional office.
• Respond promptly and thoroughly to any RBI queries during the 90‑to‑180‑day scrutiny period.
• Upon receiving the NBFC certificate of registration, immediately establish the compliance, governance and return‑filing infrastructure required under RBI’s prudential norms.

Given the capital commitment, regulatory rigour and the practical complexity of COSMOS filing, working with an experienced Banking & Finance adviser is strongly recommended. To discuss your NBFC formation plans, find a Banking & Finance lawyer through the Global Law Experts directory.

Sources

1. Reserve Bank of India, NBFC FAQ (Section 45‑IA)
2. RBI COSMOS / RBI FAQs on COSMOS (AGLOC PDF)
3. Ministry of Corporate Affairs (MCA), Company Incorporation Guidance
4. CRSPL, NBFC Registration (2026)
5. Corpbiz, NBFC Registration Process
6. Enterslice, NBFC Registration Guide
7. Taxmann, Regulatory Analysis on NBFC Compliance
8. Razorpay Learn, What Is an NBFC