NBFC Deregistration Window: July 2026 Rules & 31 Dec Deadline
RBI's April 2026 Amendment Directions introduce the Unregistered Type I NBFC category, allowing holding companies and group treasuries with sub-₹1,000 crore assets to operate without RBI registration. A 31 December 2026 deregistration window is now open for entities currently holding an NBFC Certificate of Registration.
CA Harun Raaj
Chartered Accountant · Harun Raaj & Associates
Legal basis: RBI (Non-Banking Financial Companies – Registration, Exemptions and Framework for Scale Based Regulation) Amendment Directions, 2026 — Notified 29 April 2026; In force 1 July 2026. Source: RBI-ecb-filings)) official notification. Last reviewed by CA Harun Raaj: August 2026.
The Reserve Bank of India notified the RBI (NBFC Registration, Exemptions and Framework for Scale Based Regulation) Amendment Directions, 2026 on 29 April 2026, effective 1 July 2026. This framework introduces a fundamental structural change for investment holding companies, family office structures, and group-level treasury entities that currently hold an NBFC Certificate of Registration but do not raise public funds or lend to retail customers.
For promoters and CFOs: If your entity holds an NBFC registration for intra-group investment purposes only and has never taken retail deposits or provided loans to external parties, a 31 December 2026 deregistration window is now open. Entities meeting four specific conditions may operate as an Unregistered Type I NBFC without RBI registration.
Two-Tier NBFC Classification Under the New Framework
The Amendment Directions formally establish two NBFC categories:
Key point: The new Unregistered Type I NBFC category exempts qualifying intra-group investment and treasury vehicles from RBI registration entirely, removing compliance overhead for entities that have never engaged in retail or external financial services.
Four Conditions for Unregistered Type I NBFC Status
All conditions must be met simultaneously:
- Asset size: Below ₹1,000 crore on the most recent audited Balance Sheet
- No public funds: Does not raise deposits, issue NCDs to the public, or access any form of public borrowing
- No customer interface: Does not provide loans, financial services, or NBFC-type services to external parties
- Annual Board Resolution: Passed at the start of each financial year, confirming the entity will not access public funds or have a customer interface during that year
Entities meeting these criteria are exempt from Section 45-IA (registration requirement) and Section 45-IC (statutory reserve fund) of the RBI Act, 1934.
In practice: An investment holding company or group treasury vehicle with assets under ₹1,000 crore — one that holds equity, makes inter-company loans within the group, or parks treasury funds — no longer requires RBI registration.
Group Aggregation Rule: No Structuring Below the Threshold
The Amendment Directions include an express anti-avoidance provision. Where a corporate group has multiple Unregistered Type I NBFCs, the asset sizes of all such entities in the group are aggregated for the purpose of the ₹1,000 crore test.
If the combined aggregate asset size is ₹1,000 crore or above, all such entities in the group are required to register with RBI.
Practical example: A promoter group cannot split a ₹1,200 crore holding structure into two ₹600 crore entities to avoid registration. The aggregation rule looks through group structures.
How to Deregister: The 31 December 2026 Window
If your entity currently holds a Type I NBFC Certificate of Registration and qualifies as an Unregistered Type I NBFC under the new framework, you may apply for deregistration via the PRAVAAH portal (rbi.org.in) by 31 December 2026.
Required documents:
- Audited financial statements for the last three financial years (FY 2023-24, FY 2024-25, FY 2025-26)
- Statutory Auditor certificate confirming: (a) entity has not accessed public funds; (b) entity has no customer interface; (c) the above facts are accurate as of the application date
- Board Resolution stating the entity does not have and does not intend to access public funds or have a customer interface in the future
Critical: Post-deregistration, if the entity begins raising public deposits or extending loans to external parties, it must immediately register with RBI. There is no grace period. Your Statutory Auditor's certificate creates a direct accountability link — your auditor is formally attesting to the conditions at the time of application.
What Does Not Change
NBFC-ICC Net Owned Fund requirement: The minimum NOF for an NBFC-ICC (a Type II NBFC with lending operations) remains ₹10 crore.
Scale-Based Regulation (SBR) tier structure for Type II NBFCs: The four-tier framework continues unchanged:
- NBFC-BL (Base Layer)
- NBFC-ML (Middle Layer)
- NBFC-UL (Upper Layer)
- NBFC-TL (Top Layer)
I'm CA Harun Raaj, Visakhapatnam. If your group holds NBFC registrations that may qualify for deregistration under this new framework, or if you need to assess your registration obligations, reach out and we'll evaluate your eligibility.
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See Also
Frequently Asked Questions
Does my holding company qualify as an Unregistered Type I NBFC if it only makes loans to group subsidiaries?+
If your holding company's assets are below ₹1,000 crore (latest audited Balance Sheet), it does not raise public funds, and all lending is internal to the group (no external customer interface), it likely qualifies. However, RBI's definition of "customer interface" requires careful fact-specific analysis. Consult your CA and legal counsel before filing the deregistration application to confirm your particular structure meets the criteria.
Our group has two investment companies with ₹600 crore and ₹500 crore assets respectively. Can both deregister?+
No. Under the group aggregation rule, the combined assets = ₹1,100 crore, exceeding the ₹1,000 crore threshold. Both entities must remain registered with RBI as Type I NBFCs and cannot deregister.
What happens if we start lending to external parties after deregistering?+
You must immediately register with RBI. The Amendment Directions provide no grace period. Deregister only if you are certain the entity will not access public funds or have a customer interface going forward. The Statutory Auditor certificate creates formal accountability.
Can we apply for deregistration after 31 December 2026?+
The current deregistration window closes 31 December 2026. Missing this deadline does not cancel your existing Certificate of Registration — you remain a registered Type I NBFC with associated compliance obligations. RBI has not announced whether another deregistration window will be opened.
Our NBFC is currently registered as Type II because we provide supply-chain financing loans to external vendor companies. Can we convert to Unregistered Type I?+
No. Any lending or financial services to external parties (non-group) means you have a customer interface and do not qualify for Unregistered Type I status. You must remain registered as a Type II NBFC and comply with the applicable Scale-Based Regulation tier for your asset size.
Is a Board Resolution sufficient, or do we need RBI pre-approval before deregistering?+
A Board Resolution confirming future compliance with the conditions (no public funds, no customer interface) is required as part of your deregistration application. You must submit the resolution, audited financials, and a Statutory Auditor certificate to RBI via the PRAVAAH portal. There is no separate pre-approval step; deregistration is processed once the full application is received and verified.
Does the ₹10 crore Net Owned Fund requirement for NBFC-ICCs still apply?+
Yes. The minimum NOF of ₹10 crore for NBFC-ICCs (Investment and Credit Companies classified as Type II NBFCs) is unchanged under the Amendment Directions and continues to apply to all registered NBFCs with lending operations.
What documents must our Statutory Auditor certify for the deregistration application?+
The Statutory Auditor must certify: (a) the entity has not accessed public funds (no deposits, NCDs, or public borrowing); (b) the entity has no customer interface (no external lending or financial services); and (c) both facts are accurate as of the application date. This is typically done via a separate Auditor's Certificate prepared alongside the deregistration application.
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